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Shares close 0.23% higher on favorable economic data
(Xinhua)
Updated: 2008-09-10 20:17

BEIJING - Despite losses on regional markets, Chinese shares edged up 0.23 percent on Wednesday on the back of favorable economic data, but analysts said market sentiment remained weak.

The National Bureau of Statistics said in the morning the country's consumer price index (CPI) dropped to 4.9 percent in August, which was lower than most forecasts.

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The better-than-expected figure strengthened investor confidence, as it seemed more likely that authorities might relax tightened credit and adopt long-awaited pro-active financial policies.

The benchmark Shanghai index was up 1.06 percent to close the early session. But the gain lost momentum in the afternoon on large sell-offs and the weak performance of heavyweights.

PetroChina slipped 0.81 percent to a new low of 11.08 yuan (US$1.6). The Industrial and Commercial Bank of China continued previous losses to end at 4.51 yuan, down 0.44 percent.

However, securities brokers reported wide-range gains as they are expected to start new services after the regulator published draft rules on the approval of new operations of securities firms.

Haitong Securities rose 5.59 percent to 14.91 yuan, and CITIC Securities went up 4.25 percent to 19.15 yuan among others.

The market was also boosted by the tourism sector, which soared with the looming of two national holidays -- the one-day Mid-Autumn Festival and the three-day National Day.

Beijing Capital Tourism rose to the daily limit shortly after the opening and closed at 12.01 yuan. China CYTS Tours Holding was up 8.22 percent to 8.82 yuan.

The benchmark Shanghai Composite Index closed the day 0.23 percent higher at 2150.76 points. and the Shenzhen Component Index gained 0.62 percent to 7065.47 points.

Gainers outnumbered losers by 583-248 in Shanghai and 447-244 in Shenzhen.

The combined turnover expanded to 31.64 billion yuan, up from 24.33 billion yuan a day earlier.

Analysts at the Shanghai-based Shenyin & Wanguo Securities and the Shenzhen-based Lianhe Securities agreed the market would continued the weak trend as the long-term bearish run could not be easily reversed.