China Stocks Surge; PPI Falls to 2%

123jump.com Staff
10 Dec, 2008
New York City

Producer price index in China dropped to 2% increase in November from 6.6% rise in October. Fort the year, the index rose 7.6%. Foreign direct investment in November dropped 37% to $5.3 billion in China and for the year rose 26.5% in 11 months to $86.4 billion.

[R]6:00AM New York, 6:00PM Hong Kong- China''s producer prices fall 2% in November. Foreign direct investment declined 36.5% to $5.3 billion in November.[/R]

In Hong Kong trading Hang Seng Index rose 5.6% or 824.52 to 15,577.74, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, gained 6.3% or 505.75 to 8,507.49. In Shanghai trading CSI 300 Index advanced 2.7% or 55.55 to 2,096.39.

Daily turnover on main-board stood at HK$61.9 billion from HK$56.9 billion yesterday.

China Producer Prices Ease to 2% in November

National Bureau of Statistics reported today that the country''s producer price index eased to 2% in November from 6.6% in October. Economists expected a rise of 4.5%.

In the first 11 months of the year producer prices rose 7.6% from a year ago, while purchasing prices jumped 11.6%.

Foreign Direct Investment Drops 36.5% in November

China''s commerce department reported that foreign direct investment fell 36.5% to $5.3 billion from the same period a year ago. In the first 11 months, investment climbed 26.3% to $86.4 billion.

Economists say investments next year will likely decline as global economy shrinks.

NDRC Clarifies on Stimulus Plan

Xinhua News Agency reported today that the National Development and Reform Commission said yesterday China''s Rmb 4 trillion stimulus package will be spent over the following two-years in 10 major areas including low-income housing, rural infrastructure, water, electricity, transportation, environmental protection, technological innovation and rebuilding from several disasters.

Gainers & Losers

Hong Kong stocks rose on the hopes that China will unveil a massive stimulus package to boost economic growth.
Air China gained 22% as aviation regulator in China urged companies to cancel or postpone accepting plane deliveries for 2009.

Financial stocks gained. ICBC rose 5.9% and China Construction Bank advanced 5.6%.

Commodity stocks increased on expectations that the stimulus package will boost demand for raw materials.

PetroChina gained 6%, CNOOC soared 12.7%, China Coal Energy increased 14.6% and Zijin Mining edged up 17.7%.

Chinese automakers increased after the U.S. Congress and White House agreed on a bailout plan for Chrysler LLC and General Motors. Dongfeng Group jumped 19.9%, Denway Motors advanced 13.4% and Brilliance China climbed 14.3%.