Stocks News
- Chinese shares halt slide, rising slightly
Date: 3-Jul-2007 Sources: (People's Daily)
China's stock market arrested its latest slump to close slightly higher on Monday.
The benchmark Shanghai Composite Index posted a slight gain of 0.41 percent, or 15.59 points, to close at 3836.29 points with a daily transaction volume of 91.2 billion yuan, down 15.95 billion yuan.
The key index peaked at 3,859.86 points after dipping below 3,800 points in the early afternoon trading.
The Component Index on the Shenzhen Stock Exchange fell 71.29 points, or 0.57 percent, to end the day at 12,475.16 points, with a turnover of 45.2 billion yuan, down 15.7 billion yuan.
China's top legislature on Friday authorized the Ministry of Finance (MOF) to issue 1.55 trillion yuan of special treasury bonds to fund the planned foreign exchange investment company in a bid to mitigate market liquidity.
The bonds will be used to purchase 200 billion U.S. dollars for the national foreign exchange investment company as its operating capital.
Analysts initially said the special bonds were bound to help divert money away from the stock markets, since special T-bonds will be sold to the general public.
The move, however, was interpreted as 'a neutral measure' with regard to the stock market by an MOF official.
China Business News reported on Monday that the special T-bonds would be sold to the central bank, bringing more analysts round to the MOF argument.
China's legislature also approved the suspension or cutting of the 20-percent tax on interest earned on personal savings, which was aimed at making bank savings more attractive and reducing the amount of money flowing into the stock market.
Individual investors continue to be watchful as they are concerned over further government moves to cool down the market. The combined turnover of the two markets on Friday was a recent low, and new accounts opened hit a low of 108,000 on June 28, the lowest level for three months.
On Monday, power generators and pharmaceuticals led the list of those with the biggest gains on the Shanghai and Shenzhen bourses. A rise in some heavyweight shares also boosted market performance.
The Industrial and Commercial Bank rose one percent to close at 5.06 yuan. The Bank of China climbed 0.6 percent to 5.05 yuan.
The Hushen 300 Index, which tracks 300 companies on the Shanghai and Shenzhen stock exchanges, closed at 3,757.66 points, down 43.34 points from the previous day's trading.
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