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BIZCHINA / Center

Shanghai index rises to new record

By Li Zengxin (chinadaily.com.cn)
Updated: 2007-09-20 16:57

A day after the US Federal Reserve cut the interests rate by 50 basis
points, Chinese stocks began a march to higher price levels. The Shanghai
Composite Index finished up 74.8 points or 1.39 percent to 5,470.07, a
new record high close.

Turnover of the stocks in the major indices was 216 billion yuan, the
lowest this week.

The securities regulator and industrial experts warned that investors
should not be "blindly" over-optimistic about possible effects of the US
interest cut on the domestic market, as such effects, including the
pressure of yuan's appreciation against US dollar, rising prices of oil,
gold and scarce natural resources on China's stock market, could be
moderate.

The domestic market is facing higher risks on the current levels and the
series of upcoming initial public offerings (IPO) by State heavyweights
are set to exert substantial downward pressure on the market, said
analysts.

Shanghai Composite Index
Source: sina.com.cn

Opening higher at 5,408.48, the benchmark Shanghai index took off in the
afternoon session after fluctuating modestly for the morning and toughing
a low at 5,396.11 by the noon break. It kept on rising to a high of
5,482.43 before turning down a little to the close.

Of the A shares listed in Shanghai, 507 closed up, 263 dropped and 72
remained unchanged. Shanghai Shenda?grew 10.05 percent on the top,
leading another 27 stocks rising on the maximum growth cap of 10 percent.

The Industrial and Commercial Bank of China, with the largest trading
volume, added up 0.1 yuan or 1.54 percent to lift the index up. After
gaining 81 percent on a strong debut yesterday, Bank of Beijing, with the
largest transaction value, today gained another 8.33 percent to 24.57
yuan.

Shenzhen Component Index
Source: sina.com.cn

The Shenzhen Component Index, tracking the smaller Shenzhen Stock
Exchange, opened higher at 18,139.95 and closed 148.4 points or 0.82
percent to 18,221.75. It went through the day within a range of between
18,073.24 and 18,360.24.

Of the A shares, 379 went up, 192 fell and 74 ended flat. China
International Marine Containers Group, today's largest trader in terms of
transaction value, rocketed 9.27 percent to 34.08 yuan. TCL, also traded
actively, closed with a slight drop. Stocks in the media, timber and
mining industries were the best performers today, followed by those in
construction and finance sectors.

The United States' Federal Reserve decided on August 18 to lower its
target for the federal funds rate 50 basis points to 4.75 percent.
Analysts believe such a move will boost the global stock, oil and gold
markets and increase pressure for the yuan to appreciate against the US
dollar.

The US, Australian and almost all the Asian stock markets have been
rocketing to new highs on the news. Yesterday Hong Kong's Hang Seng Index
went up 977.79 points or 3.98 percent.

(For more biz stories, please visit Industry Updates)

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