Money
Equities rally on policy hopes
By Zhang Shidong (China Daily)
Updated: 2010-07-24 10:00
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SHANGHAI - Equities rose on Friday, capping the benchmark index's best week in seven months, on speculation the government won't introduce more measures to curb bank loans and property prices after leaders pledged policy stability.
Industrial & Commercial Bank of China Ltd and Bank of China Ltd climbed at least 0.6 percent after Premier Wen Jiabao said stable policies should be the main theme in the second half.
Jiangxi Copper Co paced gains among metals producers on higher commodity prices. Shenzhen Kingdom Sci-Tech Co, a developer of financial security software, dropped the most in a week after saying first-half profit probably fell due to rising wage costs.
"The macro adjustment will be very modest in the second half and you won't see any draconian measures like what the government did in the first half," said Li Jun, a strategist at Central China Securities Holdings Co in Shanghai. "Sentiment is improving and very favorable for a rebound in stocks."
The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, gained 9.62, or 0.4 percent, to close at 2572.03. The CSI 300 Index rose 0.4 percent to 2,793.08.
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Energy and material stocks climbed the most this week, while consumer staples and utilities, considered defensive stocks, lagged behind.
The central bank has raised banks' reserve requirements three times this year and the government boosted down payments and mortgage rates for multiple-purchases of homes to curb record lending growth and asset bubbles.
The Shanghai index has fallen 22 percent this year on concern measures to control real- estate speculation and rising consumer prices will damp earnings.
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