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Shares close slightly higher, extending gains for third day

(Xinhua)
Updated: 2008-12-05 18:48

Chinese stocks closed slightly higher on Friday, extending gains to three consecutive days. Shares in the agricultural and real estate sectors led the advance.

The benchmark Shanghai Composite Index closed at 2,018.66 points, up 0.86 percent or 17.15 points, after losing as much as 1.23 percent in the afternoon trading session. The smaller Shenzhen Component Index added 148.22 points, or 2.08 percent, to close at 7,279.15.

Combined turnover was up to 120.7 billion yuan ($17.6 billion), down from Thursday's 179.94 billion yuan.

Shares opened 0.86 percent lower in the day in the wake of the quick retreat of the indices on Thursday afternoon owing to profit-taking. The key Shanghai index moved between gains and losses before it fell to the day's lowest 1975.71 points at around 2:00 pm.

It then began a quick recover, led by a rally in bank share prices, and rebounded to positive territory.

Chinese shares have closed higher in the last three trading days. On Wednesday, stocks staged a big rally with the Shanghai index rising 4.01 percent. On Thursday, shares extended gains, pushing the Shanghai index just over 2,000 points.

Agricultural companies continued to benefit from Monday's decision by China's top economic planner to scrap its 11-month interim price control measures on grain and some food products, starting this month.

Most agricultural-related shares rose with five of them jumping by the 10 percent daily limit. They were Sichuan Hejia, Dunhuang Seed, Denghai Seed, Xinjiang Xinsai and Hefei Fengle Seed.

Shares of property developers continued their upward trend since Monday, amid media reports that house sales in large cities recovered last month.

Up to 10 property shares, including Hefei Urban Construction Development, Shanghai Shimao and Huaye Real Estate, advanced by the daily maximum of 10 percent.

China Vanke, the country's largest publicly traded real estate firm, rose 5.45 percent to 7.55 yuan. Poly Real Estate climbed 4.89 to 18.67 yuan.

Shares in the telecom sector also gained on the prospects of higher equipment spending by China telecom operators on hope of the issuance of the third-generation (3G) services at year-end.

China Satcom Guomai Communications and Shanghai Potevio jumped the 10 percent daily limit. ZTE, a leading telecom equipment manufacturer, edged up slightly to 25.77 yuan. China Unicom, one of the country's telecom operator, went up 3.54 percent to 5.85 yuan

But losses of several heavyweights including PetroChina and Sinopec stopped the indices from a larger increase.

PetroChina, the largest component of the key Shanghai index, shed 0.34 percent to 11.57 yuan. Sinopec fell 0.8 percent to 8.58 yuan.

Market analysts, quoted by the Chinese financial website Hexun.com, said since most stocks gained and the key Shanghai index closed above 2,000 points, the stock market was still active with strong momentum.