Index rallies 2.5% after week-long dive
Updated: 2008-03-19 16:42
| Shenzhen Component Index |
| Source: sina.com.cn |
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The central bank decided overnight to raise the deposit reserve requirement ratio of commercial banks by 0.5 percentage point to a record high of 15.5 percent. The move echoed Premier Wen Jiabao's remarks at yesterday's press conference that the government intends to tackle mounting inflationary pressure.
However, the decision did not affect today's market greatly, as most financial stocks rebounded after sizeable losses triggered by subprime fears and tightening anticipation. China Merchants Bank climbed 3.83 percent to 29.29 yuan per share. The lender announced today it had sold all of its subprime-related assets before the mortgage crises last year, and therefore didn't lose a cent from the issue.
Stocks in neighboring Asian markets also rose as investors welcomed a 0.75 percentage point interest rate cut from the US Federal Reserve on Tuesday. The benchmark Hang Seng Index in Hong Kong closed up 2.26 percent to 21,866.94 points. Japan's Nikkei 225 Index also gained 2.48 percent by close.
A report from the China Business News today said that the regulator had approved a plan to cut the stamp tax imposed on stock trading and would implement the decision at a proper time. The news hasn't been confirmed yet by official sources, but calls for reducing the trading costs and preventing the market from drastic fluctuations have gotten increasingly high.
