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Stock rally continues in Shanghai

SHANGHAI'S key stock index rose to a 13-month high yesterday after investors rushed amid optimism of an extended bull market.

The benchmark Shanghai Composite Index was up 0.92 percent, or 28.11 points, to close at 3,088.37, setting a 13-month closing high for a third consecutive session. The rise sent the local benchmark index to a 5.5-percent weekly gain, the best in eight weeks.

Turnover dropped to 177.44 billion yuan (US$25.97 billion) from 181.11 billion yuan the previous day.

"The barometer has experienced ups and downs as a result of the combined effects of sluggish surrounding markets and an upbeat market sentiment on the local bourse," Changjiang Securities Co wrote in a research note.

"The market has been shored up mainly by heavyweights recently but there will not be much room for a rebound after the index breaks the 3,000 barrier."

Property developers led the gains in Shanghai after an influx of institutional investment.

Shanghai-based Shimao Property Co and China Merchants Property Development Co both jumped by the 10-percent daily cap to 18.13 yuan and 37.35 yuan, respectively.

"The local index is expected to keep fluctuating in the short term but investors can still find investment opportunities in undervalued shares and blue chips with good earnings in the first half," said Wen Lijun, an analyst from Nanjing Securities Co.

Coal producers rose on increased demand for energy. China Shenhua Energy Co climbed 5.19 percent to 33.45 yuan.

Metal producers were among the losers. Aluminum Corporation of China Ltd, for example, dropped 0.79 percent to 12.58 yuan.


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