Chinese shares surge 3.36% to 10-month high

(Xinhua)
Updated: 2009-06-01 23:22

BEIJING -- Chinese shares jumped 3.36 percent Monday, the first trading day after the traditional Chinese Dragon Boat Festival on Thursday, driving the benchmark Shanghai Composite Index to a nearly 10-month new high since early August last year.

Chinese shares surge 3.36% to 10-month high

Investors are seen at a stock trading hall in Lanzhou, capital of northwest China's Gansu Province, June 1, 2009. [Xinhua]

The Shanghai Composite Index gained 3.36 percent, or 88.35 points, to close at 2,721.28 points Monday.

The Shenzhen Component Index rose 2.9 percent, or 293.42 points, to 10,421.34.

Gains outnumbered losses by 762 to 90 in Shanghai and 628 to 93 in Shenzhen.

Combined turnover expanded to 225.23 billion yuan (US$32.99 billion) Monday from 161.26 billion yuan on the previous trading day.

The Shanghai Composite Index climbed more than 47 percent since the beginning of this year.

Investor confidence was heartened as China Federation of Logistics and Purchasing announced Monday that the country's Purchasing Managers' Index (PMI) stood at 53.1 in May, the third consecutive month with the gauge above the 50 mark, showing fresh sign of life in the manufacturing sector.

The Shanghai Composite Index opened 1.35 percent higher at 2668.4 points Monday, advanced by petrochemical, gold and property equities, echoing the rally on neighboring markets.

Investor sentiment was lifted for petrochemical large-caps, as China's National Development and Reform Commission, the country's top economic planner, announced Sunday its plan to raise gasoline and diesel retail prices by 400 yuan per tonne starting on Monday.

PetroChina, the country's largest oil producer, jumped 4.89 percent to 14.17 yuan, while Sinopec, Asia's top oil refiners, edged up 1.06 percent to 10.49 yuan.

Gold shares continued to gain momentum on rising gold prices and a US dollar slide, dealers said. Zhongjin Gold rocketed 9.49percent to 84.01 yuan, while Shandong Gold Mining surged by the daily limit of 10 percent to 48.95 yuan.

The property sector gained ground Monday as the State Council (Cabinet) reduced the investment threshold for property developers, the first such move in 13 years, Li Xuesong, an expert with China Real Estate Association, told Xinhua Monday.

The Cabinet announced on May 27, the last trading day before the Dragon Boat Festival, the minimum capital requirements for starting a new commercial property or an affordable housing project had been lowered from 35 percent of the total project costto 20 percent, a move to ease developers' capital strain and stabilize housing prices.

China Vanke, the largest property developer by market value, gained 4.31 percent to 10.16 yuan, while Poly Real Estate jumped 5.71 percent to 22.6 yuan.