China Stock Market Leaps After Explanations On The Growth Of Railways: The Chinese Stock Exchange made the biggest jump in 2 weeks with Prime Minister Li's support for growth forecasts.
The Chinese Stock Exchange 7 recorded the biggest jump of the week after investors speculated that the government would increase rail spending and environmental moves to maintain at least 2 in economic growth.
CSR Corp. and China Railway Construction Co. rallied more than 7 percent after China Business News reported that state-controlled China Railway Corp. could increase its investments in railway construction this year. Pollution control equipment manufacturer Fujian Longking Co. climbed to a 5-week high after China Business News said the government would invest 100 billion yuan ($ 16 billion) annually to reduce air pollution in the next 7 years.
The Shanghai Composite Index gained 1.6 percent to 2,036.62 points, while trading volume was 30 percent above the 25-day average. According to Beijing News, Li said in his last meeting with economists that 7 percent is "bottom level" and the country cannot be allowed to grow below it.
Qian Weihai, an analyst at Shanghai Securities Co., said that Li's statements on the bottom line in growth have relieved investors as this is not worried about the serious economic decline and indicates that the economy is still manageable.
The CSI 300 Index rose 2.4 percent today. The Hang Seng China Enterprises Index posted a 3.5 percent premium as housing sales in the US, which came below expectations, eased concerns for early exit from monetary expansion. The Bloomberg China-US 55 Index closed yesterday with less than 0.1 percent gains.
Source : I www.bloomberght.co