Two-month high for stocks in Shanghai
By Feng Jianmin and Ding Yining |
August 3, 2010, Tuesday
|
Print Edition
Print Edition
SHANGHAI stocks yesterday rose to the highest in more than two months amid anticipation that the central government will maintain loose monetary policies to hedge against slower economic growth.
The benchmark Shanghai Composite Index gained 1.33 percent to 2,672.52, the highest close since May 24. Turnover grew to 110.2 billion yuan (US$16.2 billion) from last Friday's 94 billion yuan.
The People's Bank of China said at the weekend that it will stick to a relatively loose monetary stance in the second half, keeping liquidity for banks at a reasonable level.
Manufacturing activities expanded the slowest in 17 months amid curbs on loans and the property market. The official Purchasing Managers' Index, a gauge of industrial activity, eased 0.9 points from a month earlier to 51.2 in July, the China Federation of Logistics and Purchasing said on Sunday. A reading over 50 indicates expansion.
"PMI has dropped for the third consecutive month but the pace was slower in July," said Zhou Donghai from Huachuang Securities. "The best option is to adopt a stable macro-economic policy to avoid inflation or deflation as economic development slows."
Huatai Securities said in a separate research note: "The market is already prepared for a slower industrial expansion and will keep active in the next few days while the index may climb above 2,700 points."
Consumption-related stocks led the gains. China's well-known liquor company Kweichow Moutai Co advanced 3.52 percent to 143.55 yuan. Wuliangye Yibin Co climbed 5 percent to 29.17 yuan. Suning Appliance Co rose 2.48 percent to 12.81 yuan.
The Industrial and Commercial Bank of China rose 1.39 percent to 4.37 yuan. The Bank of China gained 1.12 percent to 3.62 yuan. The Bank of Communications advanced 2 percent to 6.69 yuan.
The benchmark Shanghai Composite Index gained 1.33 percent to 2,672.52, the highest close since May 24. Turnover grew to 110.2 billion yuan (US$16.2 billion) from last Friday's 94 billion yuan.
The People's Bank of China said at the weekend that it will stick to a relatively loose monetary stance in the second half, keeping liquidity for banks at a reasonable level.
Manufacturing activities expanded the slowest in 17 months amid curbs on loans and the property market. The official Purchasing Managers' Index, a gauge of industrial activity, eased 0.9 points from a month earlier to 51.2 in July, the China Federation of Logistics and Purchasing said on Sunday. A reading over 50 indicates expansion.
"PMI has dropped for the third consecutive month but the pace was slower in July," said Zhou Donghai from Huachuang Securities. "The best option is to adopt a stable macro-economic policy to avoid inflation or deflation as economic development slows."
Huatai Securities said in a separate research note: "The market is already prepared for a slower industrial expansion and will keep active in the next few days while the index may climb above 2,700 points."
Consumption-related stocks led the gains. China's well-known liquor company Kweichow Moutai Co advanced 3.52 percent to 143.55 yuan. Wuliangye Yibin Co climbed 5 percent to 29.17 yuan. Suning Appliance Co rose 2.48 percent to 12.81 yuan.
The Industrial and Commercial Bank of China rose 1.39 percent to 4.37 yuan. The Bank of China gained 1.12 percent to 3.62 yuan. The Bank of Communications advanced 2 percent to 6.69 yuan.
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