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Shanghai stocks surge as China PMI rebounds
By Ye Zhen |
November 1, 2012, Thursday
|
Online Edition
Online Edition
SHANGHAI stocks advanced the most in more than three weeks after data showed an improvement in China's manufacturing, adding signs to a rebound in the world's second largest economy.
The key Shanghai Composite Index posted the biggest gain since October 9, adding 1.72 percent or 35.55 points, to 2,104.43 points. Daily turnover was 62.6 billion yuan (US$9.9 billion).
Expectation for an economic recovery was supported by the upbeat manufacturing data, which was the main force driving the market up, said He Qunrong, analyst at Everbright Securities.
China's official Purchasing Managers' Index, a gauge of manufacturing activity weighted more on state-owned firms, rose to 50.2 in October, the first time above 50 since July, according to the China Federation of Logistics and Purchasing. A reading above 50 indicates expansion.
"The PMI returned to the territory of expansion last month, suggesting the trend of stabilization and recovery in China's economy has consolidated," said Cai Jin, deputy director of the CFLP. Cai expects a modest economic recovery in the fourth quarter.
Meanwhile, a HSBC PMI report also noted improving conditions at the country's private and export-oriented manufacturers, with the index hitting an eight-month high of 49.5, from 47.9 in September, HSBC Holdings PLC announced today.
Property developers advanced after a report in the China Securities Journal said many Chinese cities are fine-tuning property policies to stimulus housing purchases. Poly Real Estate, the nation's second largest developer, increased 4.4 percent to 11.60 yuan. Gemdale Corporation added 4 percent to 5.41 yuan.
Lenders gained as the People's Bank of China, the central bank, injected 173 billion yuan to the nation's banking system via the reverse repurchase agreements, bringing its weekly injection to a record 379 billion yuan. China Merchants Bank rose 2.2 percent to 10.30 yuan. Industrial and Commercial Bank of China, the nation's biggest lender, increased 1.3 percent to 3.87 yuan.
The key Shanghai Composite Index posted the biggest gain since October 9, adding 1.72 percent or 35.55 points, to 2,104.43 points. Daily turnover was 62.6 billion yuan (US$9.9 billion).
Expectation for an economic recovery was supported by the upbeat manufacturing data, which was the main force driving the market up, said He Qunrong, analyst at Everbright Securities.
China's official Purchasing Managers' Index, a gauge of manufacturing activity weighted more on state-owned firms, rose to 50.2 in October, the first time above 50 since July, according to the China Federation of Logistics and Purchasing. A reading above 50 indicates expansion.
"The PMI returned to the territory of expansion last month, suggesting the trend of stabilization and recovery in China's economy has consolidated," said Cai Jin, deputy director of the CFLP. Cai expects a modest economic recovery in the fourth quarter.
Meanwhile, a HSBC PMI report also noted improving conditions at the country's private and export-oriented manufacturers, with the index hitting an eight-month high of 49.5, from 47.9 in September, HSBC Holdings PLC announced today.
Property developers advanced after a report in the China Securities Journal said many Chinese cities are fine-tuning property policies to stimulus housing purchases. Poly Real Estate, the nation's second largest developer, increased 4.4 percent to 11.60 yuan. Gemdale Corporation added 4 percent to 5.41 yuan.
Lenders gained as the People's Bank of China, the central bank, injected 173 billion yuan to the nation's banking system via the reverse repurchase agreements, bringing its weekly injection to a record 379 billion yuan. China Merchants Bank rose 2.2 percent to 10.30 yuan. Industrial and Commercial Bank of China, the nation's biggest lender, increased 1.3 percent to 3.87 yuan.
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