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Shanghai index up despite rate rise
By Lydia Chen |
April 6, 2011, Wednesday
|
Online Edition
Online Edition
FINANCIAL plays pushed the Shanghai market to above 3,000-point mark for the first time in nearly one month, shrugging off pressures from China's latest interest rate hike that was designed to curb rising inflation.
The Shanghai Composite Index jumped 1.14 percent to 3,001.36. Turnover expanded to 176.49 billion yuan (US$26.95 billion) from 127.3 billion yuan on April 1, the last trading day before the country's three-day Qingming Festival holiday.
Financial majors, including lenders, insurers and brokerages, were the most gained with a sub-index showing the sector rose 3.08 percent.
Analysts said today's jump showed investors confidence that tightening targeted at the country's stubbornly high inflation will no longer hurt the market.
Lenders were the leading gainers among all plays as some analysts explained the rate raise, the fourth one since October, would be positive news for banks to slightly lift their earnings.
Industrial & Commercial Bank of China, the world's biggest lender by market value, added 1.78 percent to 4.58 yuan. Bank of Communications climbed 4.30 percent to 6.06 yuan.
China raised its benchmark one-year lending rate rose to 6.31 percent from today, up 0.25 percentage point. The one-year deposit rate was lifted increased by the same level to 3.25 percent.
China International Capital Corp said in a note today that the rises in both lending and deposit rates indicated the central bank has no intention to squeeze profit margins for domestic lenders who can still now enjoy a nearly three percent rate gap after the hikes.
The Shanghai Composite Index jumped 1.14 percent to 3,001.36. Turnover expanded to 176.49 billion yuan (US$26.95 billion) from 127.3 billion yuan on April 1, the last trading day before the country's three-day Qingming Festival holiday.
Financial majors, including lenders, insurers and brokerages, were the most gained with a sub-index showing the sector rose 3.08 percent.
Analysts said today's jump showed investors confidence that tightening targeted at the country's stubbornly high inflation will no longer hurt the market.
Lenders were the leading gainers among all plays as some analysts explained the rate raise, the fourth one since October, would be positive news for banks to slightly lift their earnings.
Industrial & Commercial Bank of China, the world's biggest lender by market value, added 1.78 percent to 4.58 yuan. Bank of Communications climbed 4.30 percent to 6.06 yuan.
China raised its benchmark one-year lending rate rose to 6.31 percent from today, up 0.25 percentage point. The one-year deposit rate was lifted increased by the same level to 3.25 percent.
China International Capital Corp said in a note today that the rises in both lending and deposit rates indicated the central bank has no intention to squeeze profit margins for domestic lenders who can still now enjoy a nearly three percent rate gap after the hikes.
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