News & Reports News Year 2012 February ,2012 Stocks hit 8-week high on better outlook

Stocks hit 8-week high on better outlook


SHANGHAI'S key stock index jumped to an eight-week high yesterday on news that major shareholders increased their holdings and the central bank moved to boost liquidity.

The Shanghai Composite Index rose 0.77 percent to 2,330.41 points, the highest level since December 7.The benchmark climbed 0.49 percent for a third weekly gain, the longest since July 15.
Investors who maintained a wait-and-see stance during the previous market consolidation regained confidence after the China Securities Journal yesterday said big shareholders of listed companies had added 2.39 billion yuan (US$379 million) to their holdings this year ahead of earnings reports.
On the other hand, the central bank has suspended the new issue and repurchase of bills for a fourth week on Thursday to offset the liquidity tightening effects of the expiration of its nearly 400 billion yuan bill reverse repurchase program before the Spring Festival holiday.
Lenders gained on speculation of another bank reserve requirement ratio cut. China Construction Bank rose 0.83 percent to 4.89 yuan. The state-run Central Huijin Investment Company has agreed to let major banks, in which it holds stakes, cut their cash dividend ratios to improve capital adequacy.
Property developers recovered from overselling triggered by worries over cash flow. Poly Real Estate gained 1.14 percent to 10.68 yuan. Gemdale Group added 1.5 percent to 5.4 yuan.
Meanwhile, Guo Shuqing, head of China Securities Regulatory Commission, urged securities exchanges across the country to clear up unregulated trading before July. This also helped prop up stock prices.

Last Updated (Sunday, 05 February 2012 16:08)