Money

Equities rebound after bears go into hibernation

(China Daily)
Updated: 2010-05-11 09:15

SHANGHAI - Mainland stocks rebounded after briefly entering a bear market on speculation a slowdown in the economy may delay increases in borrowing costs and a Europe loan package will keep the region's credit crisis from spreading.

Poly Real Estate Group Co led gains among developers after BofA Merrill Lynch Global Research said China's stocks have "corrected enough". Kweichow Moutai Co gained 2.7 percent and Hisense Electric Co jumped the 10 percent daily cap as their parent companies bought back shares.

China Cosco Holdings Co, the world's largest operator of dry-bulk ships, rose 1.4 percent after the nation's April export growth exceeded estimates.

"There's a possibility the government will ease its tight monetary policies a bit since the European debt issue has make the export outlook uncertain," said Zheng Tuo, president of Shanghai Good Hope Equity Investment Management Co. "The recent sharp declines have also prompted some bargain hunting of cyclical stocks."

The Shanghai Composite Index added 10.38, or 0.4 percent, to 2,698.76 at the close after falling as much as 1.6 percent.

The measure briefly slid more than 20 percent from the close of 3,338.66 on Nov 23, a sign analysts say is a bear market.

The CSI 300 Index rose 0.8 percent to 2858.23. May futures on the CSI 300, the most active contract, gained 0.6 percent to 2912.

China Cosco gained 1.4 percent to 11.25 yuan. China Shipping Development Co, a unit of China's second-biggest sea-cargo group, rose 2.2 percent to 10.07 yuan. Cosco Shipping Co, a unit of China's biggest shipping company, added 3.2 percent to 8.61 yuan.

Hang Seng rises

Hong Kong stocks rose, halting the benchmark index's five straight days of losses.

The Hang Seng Index advanced 2.5 percent to close at 20426.64, halting a 5.6 percent slump last week. That was the gauge's biggest weekly drop since the five days ended Nov 27.

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