Shanghai Surges 9%, PetroChina Up 10%

123jump.com Staff
24 Apr, 2008
New York City

China, in a move to improve sagging sentiment among investors lowered its stamp duty tax on trading to 0.1% from 0.3%. Stock averages in China surged 9% on the move but stocks may sag again on rising inflation and growing disillusion among investors. Major indexes in China have lost at least 30% before gains of today. In Hong Kong stocks edged higher as well. Property prices are expected to rise in the second quarter as investors shift their focus away from stocks.

[R]6:00AM New York, 6:00PM Hong Kong – Stocks in Shanghai surged after China lowered stamp duty on trading transaction. Property prices are expected to rise as investors pull back from investing in stock market.[/R]

Stocks in Shanghai surged to daily limit of 10% after China lowered its stamp duty on trading to 0.1% from 0.3%. Index in Shanghai surged 9% and in Hong Kong added more than 1%.

In Hong Kong trading Hang Seng Index gained 1.6% or 391.54 at 25,680.78, and the China Enterprises Index of Hong Kong-listed mainland companies, or H shares, climbed 4.18% or 578.26 at 14,416.48. In Shanghai trading, CSI 300 Index surged 9.29% or 320.78 to 3,774.50.

Daily turnover on main-board was HK$130.3 billion from HK$105.3 billion yesterday.

China property prices to increase in second quarter

China Daily reported today that according to a report by the National Development and Reform Commission (NDRC) property prices and transaction volume might increase in the second quarter due to weak sentiment in the stock market, few investment choices and rising inflation.

""""Property prices, after a period of adjustment, are likely to maintain a moderate growth in the second quarter,"""" read part of the report.

Property development costs grew rapidly in the first quarter as the price of residential lands in the first three months of the year increased 21.7%.

China becomes largest CNC machine tool maker

The Peoples Daily online reported today at the ongoing 5th China CNC Machine Tool Fair China became the largest annual producer of CNC machine tool maker in the world with output increasing to 123,000 units – three years ahead of the production goal to manufacture 10,000 annually set by the """"11th Five-year Plan.""""

This makes China the largest annual producer of CNC machine tools in the world.

Statistics from the China Machine Tool & Tool Builders'' Association (CMTBA) reveal that the country manufactured a total of 2.7 million units of metal-cutting machine tools from 2001 to 2007, with 400,000 of which are CNC metal-cutting machine tools.

Market share for China-made CNC machine tools has risen to 48% in 2007 from the 21% in 2000.

Gainers & Losers

Stocks in Hong Kong rose trekking the movements of mainland stocks as China moved to slash tax on trading boosting investor sentiment.

HSBC fell 1% and Hutchison declined 0.5% on profit taking on cautious trading ahead of the interest rate decision by the U.S. Federal Reserve at the end of April.

China Resource Power surged 9.9% and other utilities gained on expectations in the sector that the government will raise power tariffs in the third quarter of this year.

Huaneng Power International advanced 8.4% despite posting an 80% fall in first-quarter earnings earlier in the week as its unit fuel cost rose 26 % year-on-year.

CNPC to raise gas production

China Daily reported today that China National Petroleum Corporation plans to increase natural gas output at the Xinjiang oilfield to 5 billion cubic meters annually by 2010 and then double the production in the next three to five years.

In the first quarter of this year, natural gas output at the Xinjiang oilfield topped 861 million cubic meters and crossing above its target, said CNPC.

In addition, CNPC plans to invest Rmb12 billion this year in its Dushanzi refinery in Xinjiang.