Stocks in Shanghai, Hong Kong Rise; Steelmakers Lift Prices

Devan Biswas
17 Feb, 2011
New York City

Stocks in Shanghai closed higher on earnings expectations and hopes of global economic recovery. Property developers declined after Beijing municipal government. Steelmakers gained after companies passed on higher steel prices.

[R]4:30 PM Hong Kong – Stocks in Shanghai closed higher on earnings expectations and hopes of global economic recovery. Property developers declined after Beijing municipal government. Steelmakers gained after companies passed on higher steel prices.[/R]

The Shanghai Composite Index increased 0.85% to 2,923.90 and the CSI 300 Index added 0.96% to 3,248.53. The SCI index rose for the fifth day in a row on the earnings optimism and export recovery to the U.S. and Europe.

Hang Seng index increased 0.6% and property developers declined after China announced new restrictions on home purchase in Beijing.

Industrial and steel companies gained after steel companies lifted prices for March delivery. The news report published in Apple Daily suggested that prices will increase as much as 400 yuan a ton and steel plates prices to rise between 200 yuan and 400 yuan.

Foreign Direct Investment to China Surge 23.4%

Foreign direct investment in China increased 23.4% to $10 billion and service sector drew the larger share of the increase.

The data released by the Ministry of Commerce in Beijing showed that investment in Western China rose as manufacturers look for cheaper labor and lower cost of land and manufacturing.

Services sector drew $4.96 billion or 31.8% higher direct investment than from a year ago and manufacturing attracted 18.9% increase to $4.7 billion.

Investment into western China soared 81% to $510 million and number of new foreign invested companies approved increased 20% from a year ago to 2,243.

Tibet, the region controlled by China attracted more investment as companies operating from Hong Kong direct more manufacturing and assembling plants to take advantage of lower operating costs and improved transportation linkages to cities in the East.

China’s investment in Africa in 2010 increased to $10 billion and all foreign investment from China in industries other than financial sector rose 15.9% to $2.74 billion.

Stock Movers

Pangang Group Steel Vanadium & Titanium Co increased 5% to 12.85 yuan after the company said its asset swap plan with its parent Angang New Co. was approved by Foreign Investment Review Board of Australia.

Steel makers closed higher. Wuhan Steel rose 1.6% and Baoshan Iron & Steel Company rose 2.8% to 7.39 yuan.

Inner Mongolia Baotou Steel Rare-Earth increased 1.8% after Ministry of Commerce of China said it will further regulate the exports of minerals and tackle smuggling of rare-earth-minerals.

China Vanke declined 0.6% to 8.53 yuan and Poly Real Estate Group Co fell 1.2% to 13.31 yuan. Beijing Vantone Real Estate declined 1.8%.

Tongling Nonferrous Metals Group Co increased 4.1% to 31.20 yuan after it secured as much as 55% increase copper concentrate treatment and refining charges in the first half from BHP Billiton Ltd and shorter term contract length of six months.