| Mainland's stocks rise to record led by steelmakers |
SHANGHAI, Apr. 16 -- Chinese mainland's stocks rose to a record. Wuhan Iron & Steel Co led steelmakers higher after the company said it expects first-quarter profit to surge more than fivefold, according to Bloomberg.
"Earnings growth in companies such as steelmakers is quite strong,'' said Fan Dizhao, who helps manage the equivalent of US$1.8 billion at Guotai Asset Management Co in Shanghai. "We expect average first-quarter corporate earnings to rise more than 50 percent from a year ago. The run-up is justifiable.''
China Yangtze Power Co gained after the company said it will sell shares in China Construction Bank Ltd GD Power Development Co climbed after the company said it will buy assets from its parent.
The Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B chips, jumped 2.22 percent to close at 3596.44.
Shares of Wuhan Steel, China's fifth-biggest steelmaker by output, climbed to their highest since listing in August 1999.
The stock rose 0.51 yuan, or 5.1 percent, to 10.59 yuan. The company said profit will gain more than 450 percent in the quarter after the price of the metal rebounded and it reduced costs. Net income a year earlier was 247 million yuan (US$32 million).
Maanshan Iron & Steel Co, China's largest Hong Kong-listed steelmaker by value, added 0.23 yuan, or 3.1 percent, to 7.62 yuan. Shanxi Taigang Stainless Steel Co, China's biggest stainless steel producer, climbed 1.81 yuan, or 8.7 percent, to 22.53 yuan.
Chinese steel prices rebounded from January last year after the government tightened lending and closed inefficient mills to slow the growth of production capacity. Average prices for benchmark hot-rolled coil rose to 4,201 yuan a ton in the first quarter of 2007, compared with 3,956 yuan in the same period of last year. China supplies one third of the world's steel.
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