China blue chips rally on investor confidence
China markets rose, led by blue chips, as commodity prices gained and investor confidence in the economy recovered.
The Shanghai Comprehensive Index climbed 2.02 percent to 3060.26, a one-month high, with about 60 stocks surged to the 10 percent trading cap.. The SME Comprehensive Idex added 1.50 percent to 4909.56.
The Hang Seng Index gained 1.71 percent to 21768.51, the highest since last August 12. The Hang Seng Growth Enterprises Index climbed 0.49 percent to 660.29. The Hang Seng China Enterprise Index added 1.14 percent to 12668.25.
Taiwan's TAIEX Index advanced 0.5 percent to 7477.30.
Industrial and Commercial Bank of China (SH:601398; HK:1398), the world's largest lender, advanced 3.02 percent in Shanghai and 1.30 percent in Hong Kong. China Construction Bank (SH:601939; HK:0939) added 1.37 percent in Shanghai and 0.47 percent in Hong Kong. HSBC Holdings (HK:0005), Europe's largest bank, rose 4.06 percent.
PetroChina Co.(SH:601857;HK:0857), the nation's biggest oil producer, climbed 1.9 percent in Shanghai and 1.5 percent in Hong Kong. Sinopec (SH:600028; HK:0386), Asia's largest refinery, gained 2.91 percent in Shanghai and 0.73 percent in Hong Kong.
China Life Insurance Co.(SH:601628;HK:2628), China's largest insurer, rose 3.1 percent in Shanghai and 3.14 percent in Hong Kong. China Unicom (SH:600050; HK:0762) climbed 4.33 percent in Shanghai and 1.72 percent in Hong Kong. China Shenhua Energy Co. (SH:601088; HK:1088), China's largest coal producer, gained 3.36 percent in Shanghai and 2.27 percent in Hong Kong.
Mainland-listed eclectronic shares gained 4.5 percent on average and over a dozen stocks surged to the 10 percent trading cap. Some have now surged 20 percent in two days, including Shanghai Belling Co. (SH:600171), Fujian Furi Electronics Co. (SH:600203) and SVA Electron Co. (SH:600602). The so-called "The Internet of Things" seems to be very attractive to Chinese investors right now, with analysts saying that the electronics industry has now entered the stage of cyclic recovery.
Investor confidence on the mainland has been partly driven by the lead up to the 60th anniversary of the Communist Party's founding of the People's Republic on October 1st. Tomorrow, much of Beijing's central business district (including Proactive Investors' office) is out of bounds from midday onwards as part of the preparation for the military parade and national day celebrations takes place.
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