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Stocks rise for 1st time in 9 trading days
By Lydia Chen |
May 31, 2011, Tuesday
|
Online Edition
Online Edition
SHARES in Shanghai rose for the first time in nine trading days on strength of rebounding blue chips, paring a nearly 6 percent fall this month.
The Shanghai Composite Index climbed 1.37 percent to 2,743.47, snapping the longest losing streak for the Shanghai market since December 2008. The index lost 5.78 percent this month. But turnover remained inactive at 77.8 billion yuan (US$12 billion) today.
All sectors but two posted gains in Shanghai today, led by coal makers and electricity producers which rallied over a price hike amid a nationwide power shortage.
Yanzhou Coal Mining Co was up 2.85 percent to 32.47 yuan. Huaneng Power International Inc, the listed unit of China's largest power group, advanced 1.99 percent to 5.64 yuan.
China said it will raise electricity prices for the first time in more than a year on business and farmers next month.
Power prices for industrial, agricultural and commercial users in 15 provinces will increase starting tomorrow while those paid by residential customers will remain unchanged, according to National Development and Reform Commission, the country's top economic planner.
China is facing a spreading power shortage that may be the worst on record this summer.
Rebounds by second-tier blue chips cemented the rally spearheaded by power producers.
Sany Heavy Industry Co hiked 9.66 percent to 16.80 while Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co Ltd added 4.51 percent to 70.39 yuan.
"The future performances of these smaller blue chips will decide the market's direction," said Huang Dongsheng, an analyst with Guodu Securities. "With real estate industry remains weak, it's unlike to solely rely on lenders for any rebounds."
He expected the market to stop further slides as big plays such as Industrial & Commercial Bank of China and PetroChina both started to stabilize in recent tradings.
ICBC, the world's largest lender, posted the biggest jump this year yesterday with a hike of 3.87 percent. Analysts suspected Central Huijin Investment Ltd, a wholly state-owned company authorized by the State Council, may be behind the unusual gains.
However, Jing Ulrich, managing director and chairman of global markets China at JPMorgan, said today at a press conference in Beijing that she expected the mainland market to remain at a bottom level this summer as inflation is expected to reach its highest late in the third quarter.
"The market can see a rise only after the inflation eases from its highest level while tightening from the government may also loosened," she added.
The Shanghai Composite Index climbed 1.37 percent to 2,743.47, snapping the longest losing streak for the Shanghai market since December 2008. The index lost 5.78 percent this month. But turnover remained inactive at 77.8 billion yuan (US$12 billion) today.
All sectors but two posted gains in Shanghai today, led by coal makers and electricity producers which rallied over a price hike amid a nationwide power shortage.
Yanzhou Coal Mining Co was up 2.85 percent to 32.47 yuan. Huaneng Power International Inc, the listed unit of China's largest power group, advanced 1.99 percent to 5.64 yuan.
China said it will raise electricity prices for the first time in more than a year on business and farmers next month.
Power prices for industrial, agricultural and commercial users in 15 provinces will increase starting tomorrow while those paid by residential customers will remain unchanged, according to National Development and Reform Commission, the country's top economic planner.
China is facing a spreading power shortage that may be the worst on record this summer.
Rebounds by second-tier blue chips cemented the rally spearheaded by power producers.
Sany Heavy Industry Co hiked 9.66 percent to 16.80 while Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co Ltd added 4.51 percent to 70.39 yuan.
"The future performances of these smaller blue chips will decide the market's direction," said Huang Dongsheng, an analyst with Guodu Securities. "With real estate industry remains weak, it's unlike to solely rely on lenders for any rebounds."
He expected the market to stop further slides as big plays such as Industrial & Commercial Bank of China and PetroChina both started to stabilize in recent tradings.
ICBC, the world's largest lender, posted the biggest jump this year yesterday with a hike of 3.87 percent. Analysts suspected Central Huijin Investment Ltd, a wholly state-owned company authorized by the State Council, may be behind the unusual gains.
However, Jing Ulrich, managing director and chairman of global markets China at JPMorgan, said today at a press conference in Beijing that she expected the mainland market to remain at a bottom level this summer as inflation is expected to reach its highest late in the third quarter.
"The market can see a rise only after the inflation eases from its highest level while tightening from the government may also loosened," she added.
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