Thursday, July 24, 2008
China's shares rise, led by real estate and financial stocks on economic optimism
SHANGHAI, China - Chinese shares rose Thursday, led by gains in real estate and financial stocks on optimism that lower oil prices might ease inflation pressure and improve the economy's outlook in the second half.
The benchmark Shanghai Composite Index <.SSEC> rose 2.55 percent to close at 2910.29. The Shenzhen's B-share index <.SZSB> jumped 2.43 percent to 866.64 at the close.
"Investors are acting as if they believe the economy will achieve a soft landing in the second half. Government statistics show the Chinese economy is slowing down, but it's in general still doing well," said Zhang Linchang, an analyst for Guotai Junan Securities.
Poly Real Estate Group climbed by 9.95 percent, nearing the maximum 10 percent daily limit. Its major rival China Vanke (000002.SZ: Quote, Profile , Research), the country's biggest listed property developer, added 6.66 percent.
China's biggest commercial lender, Industrial & Commercial Bank of China (601398.SS: Quote, Profile , Research)(1398.HK: Quote, Profile , Research)rose 2.38 percent, while midsize lender Pudong Development Bank Ltd. surged 8.17 percent.
China Petroleum & Chemical Corp., also known as Sinopec Corp (0386.HK: Quote, Profile , Research)(SNP: Quote, Profile, Research) (600028.SS: Quote, Profile , Research), Asia's biggest refiner, added 1.25 percent. PetroChina (0857.HK: Quote, Profile , Research)(PTR: Quote, Profile, Research)(601857.SS: Quote, Profile , Research) the country's biggest oil producer, rose 2.97 percent.
Investors were encouraged by the U.S. Federal Reserve's plans to help troubled mortgage lenders Fannie Mae and Freddie Mac, as well as dipping oil prices.
Light, sweet crude for September delivery was changing hands Thursday around US$125 a barrel in Asian electronic trade on the New York Mercantile Exchange. That's down more than US$20 in less than two weeks and eases pressure on Chinese refiners, which are chafing under government price controls that limit their ability to pass on high crude costs to consumers.
"It's certainly great news to refiners that oil prices are dropping," Zhang said. Lower crude oil prices will cut refiners' costs and give the government more room to curb inflation, he said.
The government is trying to cool an annual inflation rate that hit 7.1 percent in June _ well above the government's target of 4.8 percent for the year.
AP
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Thursday, July 24, 2008
China tightens coal price controls as country faces threat of summer power shortages
BEIJING - The government tightened price controls on coal Thursday in an effort to guarantee that power plants buy adequate supplies as China faces possible power shortages as the Beijing Olympics approach.
The government will enforce prices of 840 to 860 yuan (US$123 to US$125) per ton at China's three main markets, said a statement by the country's planning agency, the National Development and Reform Commission.
High coal prices have prompted power plant operators to let stockpiles run low, raising the risk of power shortages during summer months when demand from hotels and home air conditioners is at its highest.
Utilities have also been squeezed by government controls that bar them from passing on sharply higher prices for coal.
The government announced earlier price limits for coal on June 19 but the NDRC statement said suppliers were violating those. The NDRC's notice said market-level regulators have been ordered to scrutinize trading more closely and impose unspecified punishments on people who sell coal at higher prices than the limits.
China relies on coal to generate nearly 75 percent of its power. Low stockpiles last winter led to blackouts after severe storms disrupted supplies. Beijing ordered mines to raise output and told utilities to increase stockpiles. But the country's power agency says some have only a few days' supply, well below the recommended minimum of 15 days.
AP
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Wednesday, July 23, 2008
Aluminium falls to 5-wk low on demand doubts
LONDON, July 23 (Reuters) - Aluminium fell to a 5-week low on Wednesday on concerns about demand from automakers, while a stronger dollar and weaker oil prices also weighed on prices.
Three-month aluminium MAL3 traded at $3,015 a tonne at 1051 GMT on the London Metal Exchange from $3,035 on Tuesday.
Earlier on Wednesday, the energy-intensive metal used in packaging, transport and construction, touched $3,003 a tonne, the lowest since June 17.
"The car is the commodity world in microcosm."
Toyota Motor Corp. (TM: Quote, Profile , Research) may cut its 2008 global vehicle sales target by as much as 350,000 units to about 9.5 million because of declining sales in the United States, Japan and Europe.
Copper MCU3 also fell, trading at $8,090 a tonne from $8,130 at the close on Tuesday.
However, an announcement by BHP Billiton (BHP: Quote, Profile , Research) on Wednesday that output from its Escondida mine, producer of a tenth of the world's copper, would fall by 10 to 15 percent in fiscal year 2009 could provide some support.
"The news has not filtered through and there may be a delayed reaction," said Moore.
About 150,000-225,000 tonnes could be lost on the 18-million tonne world market over the next 12 months, he added.
Lead futures MPB3 rose to their highest level since May 28 after China's top lead producer, Yuguang Gold and Lead (600531.SS: Quote, Profile, Research, Stock Buzz), said it reduced production by about one-third in July for maintenance
Reuters
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Wednesday, July 23, 2008
China Eastern soars over 12 percent on merger talk
HONG KONG, July 23 - Shares in China Eastern Airlines (600115.SS: Quote Profile Research)(0670.HK: Quote Profile Research)(CEA: Quote Profile Research) soared more than 12 percent to a one-month high in late Wednesday trade amid speculation that the carrier would merge with a smaller Shanghai-based airline.
China's central government and the Shanghai city government are discussing merging Shanghai Airlines (600591.SS: Quote, Profile , Research) with China Eastern, major Chinese business magazine Caijing reported on its website on Wednesday.
Shares in China Eastern rose as much as 12.2 percent to HK$2.66.
High global oil prices and slowing growth in China's air passenger traffic have increased speculation the government may encourage restructuring in the industry.
Some analysts remained skeptical that a deal would happen.
"We don't see a very high possibility of this going through, with Air China (601111.SS: Quote, Profile , Research) (0753.HK: Quote, Profile , Research Reuters
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Wednesday, July 23, 2008
HK shares up 2.1 percent, at five-week high
HONG KONG, July 23 (Reuters) - Hong Kong shares were up 2.1 percent, with the main index above the 23,000 mark for the first time in nearly five weeks, as lower oil prices eased concern over the impact of high energy costs on businesses and consumers.
Airline stocks soared on the prospects of cheaper jet fuel and speculation of consolidation in the aviation industry after a report in a major business magazine said government officials were considering a merger between two mainland airlines.
China Eastern Airlines (600115.SS: Quote Profile Research)(0670.HK: Quote Profile Research)(CEA: Quote Profile Research) shot up 8.9 percent and Shanghai Airlines (600591.SS: Quote, Profile , Research) jumped 7.3 percent after Caijing magazine reported China's central government and Shanghai's city government are discussing the possibility of merging the carriers.
The mainland flag carrier Air China (601111.SS: Quote, Profile , Research) (0753.HK: Quote, Profile , ResearchCathay Pacific Airways Ltd. (0293.HK: Quote, Profile , Research) was 5.2 percent higher.
The Hang Seng Index <.HSI> ended the morning session up 2.1 percent at 23,003.10 after opening at a five-week high.
Reuters
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