Shanghai shares likely to trade higher this week
By Joyce Pan |
October 19, 2009, Monday
|
Print Edition
Print Edition
SHANGHAI shares will likely continue to gain this week as economic data due out may show encouraging signs pointing to a sound economic recovery, analysts said.
The benchmark Shanghai Composite Index closed at 2976.63 after gaining 2.2 percent last week on better-than-expected new loans and exports in September. New yuan lending reached 517 billion yuan (US$75.72 billion), beating market expectations of 400 billion yuan. Shipments from China declined 15.2 percent last month from a year earlier, the slowest pace in 11 months.
Financial figures for the first three quarters are to be released this week and positive data will help boost the index, analysts said.
"The Consumer Price Index may turn positive while economic growth may expand more than 8.5 percent in the third quarter with improved conditions in the export sector, consolidating the foundations of the economic rebound," Shanghai Shiji Investment Consulting Co wrote in a research note.
The long-awaited Nasdaq-style Growth Enterprise Market will begin trading in Shenzhen on October 30 , Shang Fulin, chairman of the China Securities Regulatory Commission, said over the weekend.
Analysts said the opening of the new market will impact the valuations of the A share market.
So far, 28 companies have raised a combined 15.48 billion yuan with initial public offerings on the new board. The price-to-earnings ratio of the 28 firms exceeded last year's earnings by 55 times, compared with an average 36 times for IPOs on the main board so far this year.
"A shares are reasonably priced now. The key index is likely to go up," said Zhang Gang, a Central China Securities Co analyst.
Qian Qimin, a Shenyin & Wanguo analyst, predicted the Shanghai Composite Index would move between 2,900 points and 3,050 points this week.
The benchmark Shanghai Composite Index closed at 2976.63 after gaining 2.2 percent last week on better-than-expected new loans and exports in September. New yuan lending reached 517 billion yuan (US$75.72 billion), beating market expectations of 400 billion yuan. Shipments from China declined 15.2 percent last month from a year earlier, the slowest pace in 11 months.
Financial figures for the first three quarters are to be released this week and positive data will help boost the index, analysts said.
"The Consumer Price Index may turn positive while economic growth may expand more than 8.5 percent in the third quarter with improved conditions in the export sector, consolidating the foundations of the economic rebound," Shanghai Shiji Investment Consulting Co wrote in a research note.
The long-awaited Nasdaq-style Growth Enterprise Market will begin trading in Shenzhen on October 30 , Shang Fulin, chairman of the China Securities Regulatory Commission, said over the weekend.
Analysts said the opening of the new market will impact the valuations of the A share market.
So far, 28 companies have raised a combined 15.48 billion yuan with initial public offerings on the new board. The price-to-earnings ratio of the 28 firms exceeded last year's earnings by 55 times, compared with an average 36 times for IPOs on the main board so far this year.
"A shares are reasonably priced now. The key index is likely to go up," said Zhang Gang, a Central China Securities Co analyst.
Qian Qimin, a Shenyin & Wanguo analyst, predicted the Shanghai Composite Index would move between 2,900 points and 3,050 points this week.
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