Money
Clean energy, consumption give stocks a boost
(China Daily)
Updated: 2010-07-22 09:50
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SHANGHAI - China's stocks rose for a third day as the outlook for increased investment in the clean energy industry and higher domestic consumption overshadowed concern the government won't relax its policy tightening measures.
Jiangsu Huasheng Tianlong Photoelectric Co paced gains for alternative fuel stocks as China said it may spend 5 trillion yuan in the next decade developing cleaner energy sources.
"The new energy industry represents structural change for China's economy and has huge growth potential," said Wu Kan, Shanghai-based fund manager at Dazhong Insurance Co, which oversees $285 million. "The market still has some doubts about cyclical stocks as the government hasn't made clear its attitude towards easing tightening measures."
The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, added 0.3 percent to 2,535.39 at the 3 pm close.
The measure has gained 4.6 percent in the past three days, the most for such a period since December 2009. It also breached its 50-day moving average intraday for the first time in three months. The CSI 300 Index rose 0.2 percent to 2,747.33.
The Shanghai index has advanced this week on the expectation the government will ease tightening measures and boost investment in low-income houses to counter a slowdown in economic growth. It's still down 23 percent this year on concern measures to control real-estate speculation and rising consumer prices will damp earnings.
China's economic expansion eased to 10.3 percent in the second quarter and industrial production cooled more than forecast in June. The central bank has raised reserve requirement ratios three times this year to rein in consumer prices and investment growth.
A plan will be submitted to develop cleaner energy, including nuclear power and gas from unconventional sources, in 2011 to 2020 to the State Council for approval, Jiang Bing, head of the National Energy Administration's planning and development department, said.
Jiangsu Huasheng added 3.3 percent to 24.83 yuan. Baoding Tianwei Baobian Electric Co, which has units making solar panels, gained 4.3 percent to 21.42 yuan.
Airline stocks rose. The companies carried 21.8 million passengers in June, 23 percent more than a year earlier, the Civil Aviation Administration of China said on its website on Tuesday. Passenger numbers rose 18 percent to 126.3 million people in the first half from a year earlier, the regulator said.
Air China, the nation's largest international carrier advanced 2.6 percent to 12.06 yuan. China Southern, the nation's biggest carrier by fleet size, gained 3.3 percent to 6.95 yuan.