Money

Stocks climb as renminbi rallies

By Irene Shen (China Daily)
Updated: 2010-12-31 09:29

The booth of Industrial and Commercial Bank of China Ltd (ICBC) at the Sixth Beijing International Finance Expo. The increase of ICBC contributed to more than half of the Shanghai Composite Index's gain on Thursday. [Photo / Provided to China Daily]

SHANGHAI - China's benchmark stock index rose for a second day after copper prices and the Chinese currency rallied to record highs, bolstering the earnings outlook for the nation's metal producers and airlines.

Jiangxi Copper Co, the nation's biggest maker of the metal, climbed to the highest in six weeks after copper prices rose to $9,480 a ton in London. China Southern Airlines Co and Air China Ltd surged more than 2 percent as the yuan advanced to the strongest level against the dollar since the end of 1993, reducing carriers' US debt costs. China Vanke Co and Poly Real Estate Group Co slid after the 21st Business Herald reported China won't loosen curbs on the property market in 2011.

"Investors are sitting on the sidelines, expecting better buying opportunities in January, when liquidity increases and banks loosen lending," said Li Jun, a strategist at Central China Securities Co in Shanghai. "There may be some technical rebound from the excessive declines, but it won't be too much."

Related readings:  Chinese shares close higher on Thursday  Copper price high but spot market trading weak  Small yuan appreciation good for Chinese economy: central bank  Chinese PMI at three-month low

The Shanghai Composite Index rose 0.29 percent to 2759.58 at the 3 pm close on Thursday, even as 456 stocks fell and 403 advanced. The CSI 300 Index added 0.07 percent to 3064.10.

Jiangxi Copper paced advances for copper stocks, adding 3.53 percent to 41.99 yuan ($6.36). Yunnan Copper Industry Co gained 4.8 percent to 25 yuan.

China Southern surged 4.72 percent to 9.54 yuan. China Eastern Airlines Corp advanced 2.06 percent to 6.45 yuan. Air China climbed 2.37 percent to 13.41 yuan.

Industrial and Commercial Bank of China Ltd, the world's largest lender by market value, advanced 3.16 percent to 4.24 yuan. The increase contributed to more than half the Shanghai Composite Index's gain on Thursday. The advance helped the gauge rebound from a 1 percent loss earlier as a gauge of manufacturing showed a slowdown after the government boosted rates to tame inflation.

SAIC Motor Corp, the nation's largest automaker by market value, declined 2.37 percent to 14.41 yuan on Thursday.

A gauge of property developers in the Shanghai gauge fell 1.5 percent. China Vanke Co slid 1.81 percent to 8.15 yuan. Poly Real Estate Group Co dropped 2.8 percent to 12.51 yuan. A measure tracking developers, banks and brokerages in the CSI 300 Index fell 28 percent this year, the most among the 10 industry groups. Haitong Securities Co has been the worst performing company in the group, plunging 51 percent as the market's slump this year.

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