Index flutters after nearing 6,000 points
Updated: 2007-10-12 16:55
Domestic A-share markets experienced drastic swings Friday owing to expectations of weekend tightening measures and after the benchmark Shanghai index briefly approached the 6,000-point milestone.
Supported by index-influential stocks with huge capitalization, the market reached 5,959.36 points once in the morning trading, almost touching the 6,000-point landmark, before the swings began.
 Shanghai Composite Index Source :www.sina.com.cn |
The Shenzhen Component Index, tracking the smaller Shenzhen market, went deeper to 19,135.2 points by the end of the trading, losing 1.08 percent from Thursday's close.
Divergence remained large among stocks in the two markets, of which 283 went up, 136 closed flat but as many as 1,075 went down. Combined turnover of the two markets reached 313.7 billion yuan (US$41.7 billion), largely attributed to panic selling during the noon dive.
 Shenzhen Component Index Source: www.sina.com.cn |
Although the National Bureau of Statistics is scheduled to release September's economic data later this month, it is widely anticipated that major inflation indicators like CPI will remain high as product prices have not declined so far.
In a related occurrence, the People's Bank of China Thursday unleashed 150 billion yuan of central bank notes with 3-year maturity period, suggesting another interest rate hike is on the way to stabilize prices, according to market watchers.
In spite of the indices' fluctuation, sound corporate earnings still supported share performances. Haitong Securities, China's second-largest listed brokerage, managed to clinch at the limit up echoing a notable 4-billion earning forecast in the first nine months. The Shanghai-based Zhongxi Pharmaceutical also shot up 10-percent after its announced a 12-fold profit growth year-on-year.
The metal sector shined today. Share prices of Yunnan Aluminum and Chihong Zinc & Germanium both reaped the maximum daily gain of ten percent. Zhongjin Gold Co, the nation's major gold producer, rose 4.09 percent to 138.08 yuan.
Blue chips with large capitalization remained stronger than the market average today. Sinopec rose 6.85 percent to a record high of 23.93 yuan. China Shenhua Energy gained a third limit up in a row since its eye-catching IPO this week.
However, given today's market vibration and further tightening expectations, the overwhelming performance of the large cap jumbos in the past week will likely not last long, according to securities analysts.
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