China shares rise as investors hope for new policy
AP - Saturday, November 8
SHANGHAI, China - Chinese shares rebounded Friday, led by financial stocks and refiners, after news reports said the government might create a fund to support prices.
The benchmark Shanghai Composite Index rose 1.8 percent, or 29.99 points, to close at 1747.71 after dropping 3 percent over the previous three days. The Shenzhen Composite Index for China's smaller second market rose 0.9 percent to 467.35.
Buying enthusiasm was also fueled after UBS Securities Co., a unit of the Swiss investment bank, bought 300 million yuan shares of 14 blue chips.
The rally came after Chinese media reported the government might announce the creation of a fund as early as this weekend to support prices by buying shares.
But the market still lacks of energy for a robust rebound, said Huatai Securities analyst Zhou Lin .
Investors also are looking ahead to a central government meeting due to be held in coming weeks to set economic goals for 2009.
Industrial & Commercial Bank of China Ltd., China's biggest commercial lender, jumped 2.2 percent to 3.77 yuan. Bank of China Ltd. added 1.3 percent to 3.12 yuan, and China Construction Bank, Ltd. rose 2.3 percent to 4.09 yuan. Midsize lender Pudong Development Bank Ltd. advanced 5.2 percent to 12.76 yuan.
Insurers surged after the industry regulator announced Friday the government has given approval for insurers to buy equity in private firms. Ping An Insurance Ltd. soared 4.8 percent to 25.15 yuan, and China Life Insurance Ltd., the country's biggest life insurer, ended 3 percent higher at 19.18 yuan.
Refiners rose after crude slid below $61 per barrel on the New York Mercantile Exchange overnight. PetroChina Ltd., Asia's biggest oil and gas producer, gained 1.7 percent to 10.51 yuan. China Petroleum & Chemical Corp., also known as Sinopec, Asia biggest oil refiner by volume, rose 2.7 percent to 6.95 yuan.
China Vanke Ltd., the country's biggest real estate developer, rose 2 percent to 5.7 yuan, and rival Poly Real Estate Group climbed 2.6 percent to 12.84 yuan.
In currency markets, China's yuan was trading 6.8257 to the U.S. dollar in over-the-counter trading in late afternoon in Asia, slightly weaker from Thursday's close of 6.8250.
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