Strong jobs growth helps drive stocks up by 1.07%
Print Edition
SHANGHAI shares closed higher yesterday, driven by strong jobs growth and despite a sharp decline in pharmaceutical stocks amid a rabies vaccine scandal that hit pharma prices across the board.
The Shanghai Composite Index jumped 1.07 percent to close at 2,859.54 points.
The Human Resources and Social Security Ministry said yesterday that urban employment grew 7.52 million in the first half of the year, an increase of 170,000 over the same period a year earlier.
The urban unemployment rate hit the lowest in several years at the end of June — 3.83 percent compared with 3.95 percent in June last year.
“In the first half, China’s employment conditions made good progress," said Ministry of Human Resources and Social Security spokesman Lu Aihong.
“The steady economic development is driven by a better economic structure, an improvement in the business environment, entrepreneurship and innovation.”
China’s GDP grew 6.8 percent year on year in the first half , the 12th straight quarter GDP growth has stayed within the range of 6.7 to 6.9 percent.
Banking shares were buoyed after China released draft rules and guidelines to strengthen regulations for financial institutions’ wealth management and asset management businesses.
On Friday, the China Banking and Insurance Regulatory Commission released draft rules on commercial banks’ wealth management products, saying that these products should be managed based on their net value.
The new rules will also lower the minimum amount of client subscription to any single public wealth management product from 50,000 yuan (US$7,360) to 10,000 yuan.
“The draft rules and guidelines will promote the healthy development of banks’ wealth management businesses and fend off systemic financial risks,” the commission said.
Shanghai-based research and consulting firm CIB Research said in a note that the changes, including the lower threshold, will attract more investors.
Li Chao, chief analyst at Huatai Securities also said that the changes send a positive signal to banks.
Iron and steel producers, infrastructure companies and banks were among yesterday’s biggest gainers.
But health care shares fell due to a vaccine scandal involving China’s second-biggest rabies vaccine producer, Changchun Changsheng Life Sciences.
Authorities said Changchun Changsheng Life Sciences had violated standards and procedures.
Shenzhen-listed Changsheng Bio-technology Co Ltd, the parent company of Changsheng Life Sciences, dropped 10 percent to 13.05 yuan.
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