Business / Markets

Stocks rally to seven-year high

By Dai Tian ( Updated: 2015-05-22 16:36

Stocks rally to seven-year high

Investor at a securities brokerage in Fuyang city, East China's Anhui province, May 22, 2015. [Photo/IC]

Chinese stocks rallied to a seven-year high on Friday, with 255 stocks jumping by the daily limit of 10 percent, led by financial, technology and healthcare companies.

The benchmark Shanghai Composite Index advanced for a fourth day and surged 2.8 percent to 4,657.95 points, marking its highest since February 2008, while Shenzhen Component Index climbed 1.1 percent to 16,045.8 points, ending the week with the biggest gain for 7 years.

Stock turnovers at the two bourses reached nearly 2 trillion yuan ($322.61 billion) on Friday.

Brokerages led the gain on Friday, after Guotai Junan Securities, one of the country's brokerage giants, said it plans an A-share initial public offering. Sealand Securities and Dongxing Securities soared by the daily limit.

The outstanding balance of margin trading in Shanghai climbed to a record high of 1.32 trillion yuan as of Thursday, market data showed.

Banks including Industrial Bank, Huaxia Bank and Nanjing Bank added more than 4 percent.

Smart-themed stocks remained bullish, as robot developer Shanghai Ken Tools Co and printing manufacturer Sotech Smarter Equipment Co jumped by 10 percent.

Healthcare stocks advanced on Friday, with Fosun Pharmaceutical, Topchoice Medical and Boji Pharmaceutical surging by 10 percent.

PetroChina and Sinopec, the country's two major energy magnets, rose 3.4 and 4.4 percent respectively, after the government said it plans to spin off some oil and gas pipeline assets as part of the State-owned enterprise reform.

Measures of coal and steel sectors edged up more than 2 percent, with Shaanxi Coal and Xinjiang Bao Steel surging by the daily limit.

China's capital outflows has stabilized on reduced renminbi depreciation expectations, but cut on the reserve requirement ratio is still needed, said Nomura Financial Group in a note on Friday, adding that the HSBC flash PMI for China rose by 0.2 percentage points in May.

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