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Stocks rocket despite ratio rise

By Zhang Ran (China Daily)
Updated: 2007-05-01 09:06

The half percentage point increase, which brings the level to 11 percent for most commercial banks, takes effect May 15.

The market accepted the ratio raise as a less harsh monetary tightening policy than an interest rate hike.

"In fact, any macro-economic level control should be seen as positive because it is healthy to the market in the long term," Zhao Jianxing, an analyst with China Merchants Securities, said.

As China' stock market heads toward 4,000 points, global leading financial firm JP Morgan Securities announced that it had raised its year-end MSCI China, and H-share index, two major indexes to monitor Chinese companies' performance in theHong Kongstock market to 63 and 12,000, up by about 17 percent.

"We think fundamentals continue to move in the right direction," Frank Gong, JP Morgan Securities' Head of China Research said last week in its annual conference inBeijing.