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China's shares yesterday achieved their highest daily increase in three
years, buoyed up by positive news and a wave of investor confidence.
Lately in the doldrums , Shanghai's Composite Index climbed 8.21 per
cent to close at 1115.582, up 84.64 points from its previous close of
1030.94.
Turnover at both Shanghai and Shenzhen bourses was nearly three times
more than their daily average. About 200 stocks jumped 10 per cent, the
daily increase limit, and not a single stock at the two bourses suffered a
fall.
"The market could not be much better," said Jiang Wen, a stock trader
in Beijing.
According to market sources, the central bank will reloan millions of
money to pilot brokers to tide over the market difficulty. The bank,
however, has yet to confirm the story.
At present about 12 securities companies meet the standard needed to
become a pilot firm allowed to experiment with product innovation and gain
support for future development.
In addition, China Securities Regulatory
Commission (CSRC) issued a draft circular on Tuesday allowing listed firms
to buy back their shares from traders. The draft is being publicized to
gauge
market reaction.
"If this move were carried out, there would be more capital injected
into the market, which would bring up prices," said Xue Jirui, an analyst
from CITIC Securities.
"The repurchase could allow the market to revaluate many shares," he
said.
Recently officials from the CSRC have made several announcements to
show the regulator's strong commitment to solving market problems. This
cheered up traders somewhat, Xue said.
Shares broke the 1,000 sentiment baseline on Monday, which offered many
investors a chance to pick up blue chip bargains and gain profit margins,
said Jiang Yiming, a Beijing investor.
(Agencies) | 
Updated: 2005-06-09 08:46
