| Shares soar almost 4% on robust expectations for banks, developers |
BEIJING, July 20 -- China shares soared nearly 4 percent on Friday, as robust earnings expectations from banks and property developers helped the market shrug off worries of economic tightening measures.
The benchmark Shanghai Composite Index added 145.91 points to rise 3.7 percent to 4,058.85, its highest close since settling at 4,078.60 on June 27.
The Shenzhen Composite Index rose by 3.9 percent, adding 42.15 points to hit 1,124.58.
Thursday's announcement of stronger than expected economic growth and higher inflation had raised investor concerns the government would announcement an interest rate hike or deposit ratio rise over the weekend.
Analysts said that could still stymie further market rises next week on optimism over listed firms' first-half results due by the end of August.
China's gross domestic product grew 11.9 percent in the second quarter from a year earlier, much faster than the 11.1 percent gain in the first quarter.
Banks extended their gains Friday after Shanghai Pudong Development Bank said its first-half net profit likely rose over 50 percent from a year earlier. It was the latest of several Chinese lenders to forecast strong earnings recently.
Property developers gained Friday on persistently strong housing demand and a continued rise in property prices.
"Even if China hikes interest rates again, the potential impact on property firms will likely be limited" due to strong housing demand, said Ding Chaoyu, an analyst at Great Wall Securities.
In currency trading, the yuan fell slightly against the U.S. dollar to 7.5712, from the previous session's 7.5636. Traders said the government set the dollar-yuan central parity at a higher-than-expected level in an apparent attempt to keep the market stable amid worries of a rise in interest rates.
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