Banking News
- Banks, property firms lead shares up
Date: 3-Aug-2007 Sources: (Shenzhen Daily)
BANKS and property firms led a rebound in shares Thursday after a sharp slump in the previous session, but concerns the government will take more measures to cool stocks may limit further gains.
Analysts expect the benchmark Shanghai Composite Index to consolidate above its 10-day moving average of 4,320 in coming sessions.
The Shanghai Composite Index, which tracks both A and B shares, ended up 2.5 percent at 4,407.73. Turnover on the index shrank to 14.26 billion yuan (US$1.88 billion) from 17.32 billion yuan Wednesday. The Shenzhen Composite Index rose 4.1 percent to 1,293.14.
'Most investors remain cautious due to uncertainty over whether the government will take more cooling steps after the hike in banks' required reserves,'said Xu Yinhui, an analyst at Guotai Junan Securities, referring to the latest People's Bank of China's hike Monday to curb excessive lending.
This caution was reflected by the absence of a sharp increase in trading volume once the Shanghai index rose above the 4,400 level, he said.
The government's warning late Wednesday to Central Government-owned firms against illegally diverting bank loans to equity and property investments also weighed, he said.
The rebound in the overall market came after a tumble of nearly 4 percent in the Shanghai index Wednesday, sparked by a broad selloff in the Asian region. Neighboring markets had tracked a decline on Wall Street.
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