Stocks finish up despite multiple pressures
Updated: 2007-09-10 16:37
Stocks in the paper, petrochemical and culture and media industries were the best performers of the day. The real estate shares led the fell in the morning but their resurgence in the afternoon contributed to stabilize and push up the indices.
This week, a series of macroeconomic data will be released to the public. The product price index (PPI) for manufactured goods in August grew 2.6 percent year on year, said the National Bureau of Statistics today. The purchasing price of raw materials, fuel and power was up 3.8 percent year on year, 0.2 percentage points higher over July.
Analysts expect the CPI growth rate last month to exceed the 10-year monthly high of 5.6 percent in July, adding more inflationary pressure to an already heated economy. More tightening measures may be announced very soon pending the results, market experts said.
The yuan reached a new high against the US dollar as the central parity exchange rate was set at 7.5252 yuan today. The yuan bypassed the 7.54 and 7.53 marks and rose 159 basic points from last Friday, refreshing the record for the 58th time this year.
The mounting foreign exchange reserves, which topped US$1.33 trillion at the end of June, are one of the forces pushing up the yuan's value. The good news is China Investment Co Ltd, the State forex investment company to make better use of the country's huge forex reserves, is expected to start operations this week, said Monday's China Securities Journal.
The benchmark Shanghai Composite Index has almost doubled since the beginning of the year despite a 2.16-percent slump last Friday. The total market value of the floating shares on the two stock exchanges surpassed 8 trillion yuan last week. The high price levels of stocks have introduced higher market volatility, analysts believe.
Shang Fulin, chairman of the China Securities Regulatory Commission (CSRC), on Friday urged securities regulators and brokerages to conduct effective education on domestic investors. "The regulators and dealers should help investors raise their risk awareness and clamp down on market irregularities," Shang said at a meeting on investors' risk education held in Beijing.
Fan Fuchun, CSRC's vice chairman, said, "The emphasis of risk education should be placed on the vast majority of small investors and investors with low incomes to give them a clear understanding of the current market situation." "Risks are increasing with the quick market expansion, new forms of market irregularities and weak risk awareness of many investors," Shang added.
As one of the new moves by the government to vent steam from the heated domestic stock market, the H-share investment plan requires more time for preparation and the exact time for its debut is undecided yet. China has finished at least half of the preparations for the local residents' direct investment in the Hong Kong stock market, Zhu Min, vice president of Bank of China, said Saturday.
"The preparations are going smoothly, but there are still many technical problems yet to be addressed," Zhu said in Dalian. "It takes a lot of time to prepare new software and investor education, and train staff members. However, we have no plan to delay it," he said.
"Tianjin is the only pilot city. It's hard to say if the program will expand to other cities in the future," Zhu noted in response to earlier media reports saying the program would be expanded to many other cities and be launched in early September.
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