Markets

Stocks rise as policy concerns fade

By Chua Kong Ho and Irene Shen (China Daily)
Updated: 2010-11-20 10:01

SHANGHAI - Stocks on the Chinese mainland rose, with the benchmark index erasing an earlier loss of two percent, as concern faded that policymakers will raise interest rates as soon as this weekend and Ireland moved closer to a financial bailout.

Kweichow Moutai Co and Wuliangye Yibin Co climbed more than two percent after Nomura Holdings Inc said it's "bullish" on the nation's food and beverage stocks.

"There is much uncertainty regarding further monetary policies," said Zack Liu, head of quantitative investment at China Southern Fund Management Co in Shenzhen. "That will influence the market sentiment and lead to volatility."

The Shanghai Composite Index added 0.81 percent to 2,888.57 at the close on Friday after swinging between gains and losses at least 10 times.

The measure lost 3.2 percent this week, extending last week's 4.6 percent decline. The CSI 300 Index climbed 0.98 percent to 3,178.85 on Friday.

The Shanghai gauge has lost 8.6 percent since reaching a seven-month high on Nov 8 on speculation the government will raise interest rates and impose price controls to slow inflation that grew at the fastest pace in two years in October.

The MSCI Asia Pacific Index climbed 0.3 percent on Friday after earlier retreating as much as 0.2 percent on optimism a bailout for Ireland will prevent contagion across the region's larger debt markets.

Kweichow Moutai Co gained 3.35 percent to 175.16 yuan ($26.4) on Friday. Wuliangye Yibin rose 2.75 percent to 37 yuan.

SAIC Motor gained 1.17 percent to 18.21 yuan after buying a 0.97 percent stake in General Motors.

A measure of technology stocks surged the most in two weeks in the CSI 300 Index after Dell Inc posted earnings that beat analysts' predictions.

US companies still want to do business Related readings:  China stock index futures close up -- Nov 18  Mainland stock rise extends into 6th day  SAIC buys 0.97% stake in GM IPO

Guangdong Shengyi Science Technology Co, a printed circuit board maker that got more than half of its sales overseas, jumped 6.2 percent to 10.99 yuan on Friday.

Bank of China Ltd slid 0.3 percent to 3.32 yuan after falling as much as 2.7 percent on concern the central bank will boost borrowing costs. China Citic Bank Corp retreated 1.05 percent to 5.65 yuan after tumbling as much as 3.7 percent.

In Hong Kong stocks fell, dragging the benchmark index to a second straight week of losses, as developers dropped on concern the city will introduce measures to cool its property market.

The Hang Seng Index slid 0.13 percent to close at 23,605.71, extending its losses this week to 2.6 percent.

The Hang Seng China Enterprises Index of H shares of mainland companies was little changed at 13,170.65 on Friday.

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