Stock index reaches new high on first day
By Jin Jing and Wang Zhenghua (China Daily)Updated: 2007-01-05 09:10
The Chinese stock market boom is "led by the huge amount of liquidity", said
Sanft. Part of the funds that have been rushing into the stock market in recent
months were channelled from bank deposits and other investment markets,
including commodities and gold.
The sectors that have benefited most from
the stock market rally include services and capital goods.
Within the
services sector, banks have done particularly well. The share price of the Industrial and Commercial Bank of China, for instance, has
gone up a total of 78 percent from its debut in October 2006. It closed at 6.05
yuan yesterday, down from 6.20 last Friday.
Currently there are seven
banks listed on the stock exchange. Three more are expected to obtain a listing
in 2007. "The banking sector will remain a focus for the stock market," said Gao
Yuan, an analyst at Everbright Securities.
Zhang Yidong, an analyst at
Industrial Securities, agreed. "Product innovations will help banks to do well
in the coming years," he said. What's more, the lowering of the corporate tax to
a unified rate of 25 percent from 33 percent in the past should benefit the
financial industry the most, Zhang added.
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