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2007-12-5 03:48:00 p.m. HKT, XFNA
China A-shares close sharply higher on PetroChina; index beyond 5,000 - UPDATE
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(Updating with prices, comment) -
SHANGHAI (XFN-ASIA) - China A-shares closed sharply higher with investors
encouraged by a strong rebound in PetroChina after the stock dipped close to
a record low, dealers said.
Heavyweight steelmakers continued to rise on bargain-hunting and amid
speculation that Baosteel may bid for Anglo-Australian miner Rio Tinto.
The benchmark Shanghai Composite Index closed up 126.77 points or 2.58
pct at 5,042.65.
Turnover rose to 79.74 bln yuan from 60.78 in the previous session.
PetroChina Co Ltd (SHA 601857) gained 0.85 yuan or 2.78 pct to 31.44. It
was up as much as 4 pct to 31.80 after falling to 30.34, just above the
all-time low of 30.30 set on Monday.
""The strong rebound in PetroChina boosted investor confidence,"" said Hua
Xin, an analyst at Founder Securities. ""PetroChina bounced after recent steep
falls, with the gain filling the price gap formed on Monday.""
However, Hua said the country's largest oil company could resume its
downtrend and fall below the 30 yuan level, though it had fallen nearly 40
pct from the 48 yuan high set on its first trading day in Shanghai on Nov 5.
The stock trades at about 15 hkd in Hong Kong and some analysts value its
A-shares around 22 yuan, he said.
China Shipping Container Lines and SDIC Xinji Energy launched
subscriptions for retail investors today ahead of their Shanghai listings.
China Pacific Insurance (Group) Co Ltd (CPIC), the country's
fourth-largest insurer, which received regulatory approval for its initial
public offering on Monday, is also expected to list in Shanghai soon.
""The market performed strongly despite liquidity pressure from
subscriptions of IPO shares. Steelmakers led the gains and pushed the key
index back above 5,000 points,"" said Zhang Qi, an analyst at Haitong
Securities.
Baoshan Iron & Steel Co Ltd (SHA 600019) added 1.03 yuan to 16.56, and
Wuhan Iron & Steel Co Ltd (SHA 600005) rose 1.30 yuan to 16.69.
Angang Steel Co Ltd (SZA 000898; HK 0347) gained 2.42 yuan to 28.80.
""Steel stocks, with the lowest PE ratios among A-shares, were pushed up
this week by bargain huntings after they retreated 30 pct in recent weeks,""
said Haitong's Zhang.
""Many steel producers have raised their product prices for the first
quarter next year, which will help to reduce the pressure from rising iron
ore costs,"" he added.
China Railway Group Ltd (SHA 601390), which debuted in Shanghai on
Monday, soared 0.65 yuan or 8.30 pct to 8.48. The company will start to trade
on Hong Kong stock exchange on Friday with the IPO price set at 5.78 hkd.
China Life Insurance Co Ltd (SHA 601628; HK 2628) rose 1.32 yuan to 59.
47. Japanese media reported the company is considering taking a stake in a
Japanese insurer or asset management company.
Shanghai Airlines Co Ltd (SHA 600591) aded 0.18 yuan to 15.84. The
carrier will join the Star Alliance airline group on Dec 12, the official
Xinhua News Agency reported.
China United Telecommunications Corp Ltd (SHA 600050) rose 0.13 yuan to
10.07.
Shares in Hong Kong-listed China Unicom fell sharply in the morning,
following reports that some institutional investors have placed a total of
150 mln shares at 16.0-16.2 hkd each, raising up to 2.43 bln hkd.
The Shanghai A-share Index rose 133.10 points or 2.58 pct to 5,291.46 and
the Shenzhen A-share Index was up 37.32 points or 2.82 pct at 1,359.30.
The FTSE/Xinhua China A 50 Index was up 559.70 points at 20,077.39 and
the FTSE/Xinhua China A 200 Index was up 403.24 points at 14,234.12.
(1 usd = 7.4 yuan)
lilian.wu@xfn.com xfnlw/xfntm
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