Chinese shares surge over 4%, led by banks and oils

(Xinhua)
Updated: 2008-12-03 17:24

Heavyweight China Life, the nation's leading life insurer, rose 4.13 percent to 18.90 yuan, while Ping An Insurance jumped by 6.21 percent to close at 23.95 yuan.

Despite the fall in world oil prices, shares of coal producers, which market analysts believed were undervalued after continuous falls, made a huge rally with an average eight percent increase.

Nearly 15 shares, including Shanxi Lanhua, Shanxi Guoyang New Energy, Yanzhou Coal Mining Company and Pingdingshan Tian'an Coal Mining, jumped by the 10 percent daily limit.

Textile companies continued to benefit from the weak yuan against the US dollar, which investors believed would help them increase exports.

China's currency, the yuan, fell by the daily limit against the US dollar for a second day on Tuesday, its fourth straight daily decline. The yuan finished at 6.8870 per US dollar on the over-the-counter market, having declined 0.5 percent against its central parity rate.

Golden Sun Securities said in an investment report that the stock market, despite a big rally in the day, was still faced with heavy pressure because of the uncertainties of the world economy and a large number of to-be-unlocked shares.

More than 23.3 billion shares would become tradable this month as their lock-up period ended. Such a volume was the second largest this year, only after that in August, which saw about 27.55 billion shares being unlocked and traded.

China started a program in 2005 to convert non-tradable shares into tradable stocks. And major shareholders of non-tradable stocks were subject to a one or two years of lock-up.

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