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Nation's rail investment rises 9% in 2012: NDRC

China is boosting railway investment this year by 9 percent to 448.3 billion yuan ($70.3 billion), according to a provincial office of the National Development and Reform Commission.

The previous plan was for spending 411.3 billion yuan, according to a statement dated July 6 on the website of the Anhui branch of the NDRC and citing the Ministry of Railways.

China's fixed-asset investment has already started to pick up and a jump in spending on railway construction would echo stimulus rolled out during the global financial crisis.

Stocks fall to the lowest level in more than 3 years

Mainland stocks fell, dragging the benchmark index to the lowest level since March 2009, as concerns about slumping profits overshadowed speculation the government will introduce stimulus measures for the economy.

The Shanghai Composite Index fell 1.7 percent to 2,147.96 at the close, the lowest level since March 13, 2009. The Shenzhen Component Index slid 3.6 percent.

The Shanghai Composite has fallen 2.3 percent this year on concern Europe's debt crisis and China's property curbs are hurting economic growth. The measure is valued at 9.5 times estimated profit, data compiled by Bloomberg showed.

Losses cast shadow on China's solar equities

Hareon Solar Technology Co and Shanghai Chaori Solar Energy Science & Technology Co led 10 percent daily limit declines among Chinese solar companies on expectations of first-half losses.

A global oversupply of solar modules has dragged down prices along with subsidy cuts in European countries. Chinese module prices have tumbled to a record 77 US cents per watt as of July 2, a 47 percent decline from a year earlier, according to Bloomberg New Energy Finance.

First-half earnings estimates led to the share declines, said Yao Wei, a Beijing-based analyst at Founder Securities Co.

"The market situation won't be reversed in the short term and small and medium-sized companies will suffer more than big companies" because of their lack of brand and technology, he said.

Sands China gets extension for new Macao casino

Sands China Ltd said it was given more time to build a casino resort in Macao on land granted by the government of the special administrative region, and expects to pay a penalty for the delay.

The Macao government extended a deadline to develop a plot called Parcel 3 to April 17, 2016, from April 2013, Sands said in a statement to the Hong Kong Stock Exchange on Monday. The government also said the casino operator will be notified about the penalty amount for delaying the construction, according to the statement.

Construction has yet to begin on Parcel 3, which is slated for the company's biggest project after the $5 billion Cotai Central resort opened this year.

China halves rare earth mining rights

China, the supplier of 90 percent of the world's rare earths, cut mining rights for the materials by about half to 65 nationwide to help the industry consolidate and create bigger producers.

Rare earth mining rights in Ganzhou, Jiangxi province, were reduced to 44 from 88, Chen Zhanheng, deputy secretary-general of the China Rare Earth Industry Association, said on Monday. The southwestern province of Sichuan had its rights lowered to seven from 18, while the Inner Mongolia-based Baotou Iron & Steel Group Co absorbed its local rivals, the Ministry of Land and Resources said on its website, without giving details.

The United States, the European Union and Japan complained in March to the World Trade Organization about China's limits on exports of rare earths, a group of 17 chemically similar elements used in wind turbines and hybrid cars.

Bank of China 'planning first Dim Sum bond since 2010'

Bank of China Ltd planned to sell its first Dim Sum bond in almost two years on Monday, according to a person familiar with the matter.

The mainland's fourth-largest lender by market capitalization is marketing a sale of as much as 1 billion yuan ($156.8 million) of three-year notes in Hong Kong, the person said, asking not to be identified because the details are private. It is offering the debt to investors to yield 3.1 percent to 3.2 percent, according to the person.

Bank of China last sold Dim Sum bonds in September 2010, when it offered 5 billion yuan of the securities, according to data compiled by Bloomberg. The 2.2 billion yuan two-year portion of the notes matures this year, the data show.

Guangdong factories may close as exports falter

More than 2,000 Hong Kong-owned factories in the Pearl River Delta may close this year as export orders fall and wages rise, a business association said.

Stanley Lau, deputy chairman of the Federation of Hong Kong Industries, gave the estimate in a phone interview. The organization's members have garment, watch, toy and footwear factories in the export hub of Guangdong.

Sinopec Shengli H1 output rises to 13.69 million tons

China Petroleum & Chemical Corp increased output in the first half of the year at its Shengli field, the company's largest, by 126,500 metric tons from a year ago to 13.69 million tons of crude, China Petrochemical Corp, the parent company, said on its website on Monday. China Petroleum, or Sinopec, is targeting output of 27.5 million tons from the area this year, it said.

Nation able to free up rates for large deposits

China has the ability to give banks greater freedom to decide how much they pay for large deposits or even scrap a ceiling on such rates as the next step in liberalizing the country's interest rates, the central bank's statistics chief wrote in a newspaper article.

The People's Bank of China, which announced last month it would let banks offer deposit rates as much as 10 percent higher than a benchmark it set, can widen how much lenders are allowed to pay for large sums deposited for medium and long periods of time, Sheng Songcheng, head of the central bank's statistics department, wrote in the Financial News. The ceiling for such deposits could also be removed, Sheng wrote in Saturday's edition of the newspaper published by the central bank.

Car dealers will boost discounts on inventory

China's automobile dealers will increase incentives and discounts as they struggle with a worsening glut in the world's biggest vehicle market, according to the nation's top economic planning agency.

Average retail vehicle prices fell 1.2 percent in June from a year earlier, with those for passenger vehicles dropping 1.9 percent, said Cheng Xiaodong, head of a unit that monitors auto prices at the National Development and Reform Commission. In May, passenger-vehicle prices slumped the most in about two years because of overstocking.

"The oversupply situation persists," Cheng said in an e-mailed statement on Monday. "Facing slugging demand and rising inventory, dealers will increase discounts and incentive offerings in the coming months."

China Daily - Agencies

(China Daily 07/17/2012 page14)