| Mainland stocks rise in volatile trade |
SHANGHAI, June 6 -- CHINESE mainland stocks rose after deputy central bank governor Wu Xiaoling said market gains are "inevitable." Trade was volatile as speculation the government would announce supportive measures today failed to be realized.
Shanghai International Airport Co and China Vanke Co, the nation's biggest listed property developer, paced the advance, as some investors considered recent falls to be excessive.
"Signs have emerged now that the government is trying to support the market through comments by officials or an even faster pace of mutual fund sales,"said Sun Chao, an analyst at Citic Securities Co in Shanghai. "Confidence is now gradually returning."
The Shanghai Composite Index, which tracks the bigger of domestic stock exchanges, rose 0.2 4 percent to 3,776.317. The Shenzhen Component Index, which covers the smaller one, added 2.67 percent to 12,338.183.
Shares worth 276.6 billion yuan (US$36.2 billion) were traded on the Shanghai and Shenzhen markets today, according to West China Securities Co. That's less than the record 407 billion yuan on May 30.
Investors "should have confidence in the country's economy" and market gains are bound to happen, deputy central bank governor Wu said.
"In a situation where the economy is growing, the stock market's advance is inevitable and long-term gains in the Chinese market is inevitable," Wu said, after attending a conference today in eastern China's Tianjin city.
China authorized the creation of four mutual funds to improve investors' confidence, China Securities Journal reported yesterday, citing unidentified people. The funds will be allowed to raise as much as 10 billion yuan from investors to buy stocks.
The market rebounded yesterday afternoon from a drop of as much as 7.5 percent on speculation the government would, among other measures, rule out the introduction of a capital gains tax, according to Xie Yan, an analyst at Haitong Securities Co in Shanghai.
Today, "sentiment was initially weak, because none of the rumors about new supporting measures came true," said Fan Dizhao, who helps manage about US$1.8 billion at Guotai Asset Management Co in Shanghai. "But some buying came in, as certain stocks already look attractive in valuation terms compared with what they were a couple of weeks ago."
Shanghai Airport, operator of China's second-busiest airfield, jumped 3.49 yuan, or 9.6 percent, to 39.81 yuan. The stock slid 3.7 percent on June 4. China Vanke, the nation's biggest listed property developer, rose 0.85 yuan, or 4.8 percent, to 18.75 yuan. The shares fell by the 10 percent daily cap on June 4.
China's securities account openings rose at the slowest pace in almost two months on June 4 as the stock-market rout, triggered by the higher tax on share trades, deterred people from entering the market.
A rally in A-share prices since 2005 has been ``consistently correlated'' with the number of trading accounts opened, Jonathan Anderson, chief Asia economist at UBS AG in Hong Kong said in a report last month.
The number of accounts set up for trading mainland shares and investing in mutual funds totaled 240,485 on June 4, the lowest tally since April 11, according to the latest figures by the China Securities Depository & Clearing Corp. That's down from a peak of 1.08 million accounts opened on April 30.
Elsewhere, Hunan Valin Steel Tube & Wire Co, partly owned by the world's biggest steel producer Arcelor Mittal, gained 0.15 yuan, or 1.7 percent, to 8.84 yuan. The company said it will invest about 1.7 billion yuan building roads and steel plants to meet soaring demand in China.
|
|
