China Targets 7% Growth, Inflation Worries

Devan Biswas
03 Mar, 2011
New York City

Stocks in Shanghai edged lower ahead of plenary meeting this week and approve several economic projects. China has targeted 7% economic growth in the period between 2011 and 2015. China said former Railways Minster Liu is under bribery investigation. Airlines declined.

[R]5:00 PM Hong Kong – Stocks in Shanghai edged lower ahead of plenary meeting this week and approve several economic projects. China has targeted 7% economic growth in the period between 2011 and 2015. China said former Railways Minster Liu is under bribery investigation. Airlines declined as crude oil traded above $100 a barrel.[/R]

Stocks in Shanghai declined on the worries that inflation will warrant a tighter monetary bias and earnings may lag expectations. China legislature is scheduled to meet on March for ten days to approve economic development plans till 2015 and have targeted 7% annual growth in the period.

Hong Kong stocks closed higher after U.S. private sector added more jobs in February and U.S. Fed said economic momentum is higher in 2011.

The Shanghai Composite Index declined 10.8 or 0.4% to 2,903 and CSI 300 Index fell 0.7% to 3,221.72.

Hang Seng Index added 0.3% to 23,122.40.

Crude oil inched higher in Asian trading to rise to $102.15 a barrel but closed at the session’s low to $101.54 after Reuters reported that Muammar Gaddafi and the president of the Arab League agreed to a peace plan. Venezuelan President Hugo Chavez also offered to create a multinational mediation commission.

China said former Railways Minister Liu Zhijun Liu was investigated for bribery charges and government also replaces deputy chief engineer Zhang Shuguang for “severe violation of discipline”

Stock Movers

HSBC Holdings Plc added 0.4% in Hong Kong trading after declining 7% in the last three days of trading.

Airlines closed lower after International Air Transport Association lowered its profit estimate of world airline industry estimate to $8.5 billion from the $9.1 billion estimate in November.

Air China declined 1.85 to 11.45 yuan and China Southern Airlines declined 2.1% to 8.52 yuan.

China CNR declined 3% to 7.80 yuan and China Railway Construction Corp decreased 0.4% to 7.08 yuan.

Banks traded higher in Shanghai. China Merchants Bank increased 4.2% to 14.01 yuan and China Construction Bank Corp increased 1.4% to 4.92 yuan. ICBC Ltd gained 0.5% to 4.29 yuan.