Stocks climb up in morning session

By Li Zengxin (
Updated: 2007-06-01 13:48

Chinese stocks opened higher today and closed at 4,162.97 in the morning session, up 1.3 percent on a volatile path with sudden drops and quick bouncing-backs.

The Shanghai Composite Index opened from 4,120.63 and changed directions frequently. At around 10:30, it had another steep dive, dropping 100 points to the lowest 4,059.87. There it made the fourth turn-around and began the ride. The index stopped 53.32 points up at the closing time.

Also opening higher, the Shenzhen Component Index ended at 13,057.09, up 0.81 percent. It went through the day within a range between 12,844.82 and 13,185.59.

High-price heavy weights were strong, supporting the turning-backs when stocks hit temporary lows.

Aerospace and military sector was leading the growth. Guangzhou Shipyard International, Long March Launch Vehicle Technology and Jiangxi Hongdu Aviation Industry rose sharply. Non-ferrous metals, port and textile industries were also the leaders.

Sinopec kept running high, leading a surging wave of petro shares. Large blue chips lifting the market also include the Industrial and Commercial Bank of China, China Merchants Bank, Daqin Railway, Wuliangye and Baoli Real Estate. Special treatment and loss making shares had the largest drop.

Regarding the recent turbulences seen in the stock market, vice governor of the People's Bank of China Wu Xiaoling said in Brussels that if the market fails to maintain stability, investor confidence of Chinese people will be severely damaged, which might adversely affect the consumer demand. Her comments reflected the concerns by the central government over the excessive volatility problem.

Stock account opening hit another record in May. New A-share accounts opened last month amounted to 5.33 million, with 44,000 new B-share accounts. On May 25, the accumulative number of stock accounts in the Chinese mainland broke the 100 million mark. Yesterday, new A-share opening was 34,400 while that of B-share slid to 5,895.

The red hot stock market has brought huge profits to stock brokers. By yesterday, there were 102 securities firms that have submitted their audited 2006 results to the China Securities Association. The companies earned a total net profit of 25.7 billion yuan

By the end of 2006, the 102 firms had total asset of 670.8 billion yuan, net asset of 108.2 billion yuan. Total operating income for the year was 69.4 billion yuan.

Of the 102 companies, six had a loss last year, one was in asset reshuffle, and the rest all made profits. China Galaxy Securities ranked on top in terms of assets, with its total asset reaching 43.2 billion yuan. While in terms of net asset, CITIC Securities, Guotai Jun'an Securities and Merchants Securities were the top three. Concerning net profit, CITIC, Galaxy and Guoxin Securities were the biggest gainers last year.

(For more biz stories, please visit Industry Updates)

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