Stocks News
- Official's comments lift shares
Date: 20-Dec-2007 Sources: (Shenzhen Daily)
COMMENTS from the State-owned assets regulator and a report that regulators will allow the resumption of local mutual fund sales helped boost shares yesterday.
The benchmark Shanghai Composite Index ended up 2.2 percent at 4,941.78. The Shenzhen Composite Index rose 2.2 percent to 1,339.09.
Traders said the Shanghai index would likely test resistance at 5,000 points, though the market's gains may be limited by lingering worries of another interest rate hike before the year ends.
Li Rongrong, chairman of the State-owned Assets Supervision and Administration Commission, was quoted as saying State-owned enterprises wouldn't dump shares in their listed units, because they want to give shareholders sustainable and steady returns.
Unnamed fund researchers were also quoted as saying that seven large domestic mutual funds would be selling units to new subscribers within a week of each other.
Shanghai Securities analyst Guo Yanling said these developments helped ease investors' concerns over slowing cash inflows into the market and a potential oversupply of shares that could drive down prices.
'The government's assurance that State-owned companies won't dump shares eased concerns of a vast increase in share supply, while the ability of funds to sell units again is expected to unleash more cash into the markets,'said Guo.
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