Chinese shares up 0.56% on booming investor confidence

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(Xinhua)
Updated: 2009-03-24 16:24

Chinese equities rose for seventh straight trading days by edging up 0.56 percent Tuesday on booming investor confidence and bullish outside markets, said analysts.

The Shanghai Composite Index climbed 12.94 points to 2,338.42. The Shenzhen Component Index rose 0.78 percent, or 69.09 points, to 8,954.84.

Gains outnumbered losses by 506 to 349 in Shanghai and 443 to 280 in Shenzhen.

Combined turnover expanded to 228.29 billion yuan ($33.43 billion) from 227.4 billion yuan on the previous trading day.

Investors took heart from Monday's move by the State Council (cabinet) to require its subordinate ministries and commissions, and the People's Bank of China (PBOC, central bank), to do more to stabilize the stock market.

Investor confidence was also boosted after the PBOC and China Banking Regulatory Commission (CBRC) Tuesday urged financial institutions to further "adjust" their credit structure and promote stable and fast economic development.

The two bodies jointly called for more loans for small and medium-sized businesses and expanded consumer credit for big-ticket items like cars, housing and education.

Strong gains in other markets including the United States and Hong Kong also contributed to the uptrend, analysts said.

Real estate stocks remained strong, climbing 1.27 percent in reaction to the PBOC-CBRC statement on consumer credit. Hainan Pearl River Holdings soared by the daily limit of 10 percent to 6.6 yuan and Shanghai Nine Dragon rose 7.58 percent to 5.39 yuan.

Poly Real Estate Group, China's second largest developer, edged up 1.06 percent to 22.98 yuan.

The medical sector rose 1.29 percent as investors bought shares in anticipation of gains after a long-awaited, detailed plan for China's medical reform.

Topfund Pharmaceutical and Fuxing Pharmacy led the rise, surging 6.71 and 6.51 percent to 4.77 and 13.74 yuan, respectively.

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