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January 1, 2010

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Home » Business » Finance

Stocks see 80% yearly increase

SHANGHAI'S stocks closed slightly higher yesterday on the last trading day of 2009 to notch an 80 percent annual gain after the central government stimulus measures boosted investor confidence, following a 65 percent slump in 2008.

The benchmark Shanghai Composite Index rose 0.45 percent, or 14.54 points, to close at 3,277.14. Turnover fell to 139 billion yuan (US$20.4 billion) from Wednesday's 157.8 billion yuan as trading remained flat.

The barometer hit an intra-year high of 3,487.01 on August 4, a 91 percent jump from the beginning of the year.

The 4 trillion yuan government stimulus package and 9.2 trillion yuan in new bank lending in the first 11 months of last year boosted spending in consumer goods and automobiles.

"The index will keep the upward trend in the first quarter as the consumer sector will benefit from holiday spending and listed companies' earnings are seen to improve," United Securities wrote in a report.

But Guoyuan Securities' Kang Hongtao said investors should be prepared for a "short-term adjustment."

Banks rode on Wednesday's gains after the Industrial Bank said in a report that new loans may reach 500 billion yuan in December, significantly higher than the previous estimate of 300 billion yuan. The Bank of Communications jumped 1.85 percent to 9.35 yuan, the Industrial and Commercial Bank of China edged up 0.93 percent to 5.44 yuan and China Construction Bank added 1.64 percent to 6.19 yuan.

China Citic Bank said its board approved the sale of as much as 25 billion yuan of bonds this year to replenish capital. The stock shed 0.72 percent to 8.23 yuan.

China Eastern Airlines rose 1.48 percent to 6.17 yuan after it said in a statement that profit for the whole last year will be around 600 million yuan, citing Chairman Liu Shaoyong.


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