China shares surge over stimulus plans
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E-mail Xinhua, September 7, 2012
China stocks on Friday posted the biggest single-day rallies in almost eight months and recovered last month's losses in just one day after the country's top economic planner unveiled trillion-yuan stimulus plans to buoy the slowing economy.
The benchmark Shanghai Composite Index jumped 75.84 points, or 3.7 percent, to close at 2,127.76, marking the biggest daily gain by percentage points since Jan. 18 this year.
The Shenzhen Component Index surged 420.8 points, or 5.08 percent, to close at 8,709.07.
Over the past two days, the National Development and Reform Commission, China's top economic planner, approved 55 investment projects worth 1 trillion yuan (157.7 billion U.S. dollars) to build highways, ports and railways across the country.
Friday's gains in the Chinese equity markets also tracked global rallies overnight after the European Central Bank agreed on Thursday to launch a new and potentially unlimited bond-buying program to try to calm the effects of the European debt crisis.
Investors who have been battered in recent weeks turned joyful over the news and rushed to buy shares related to infrastructure construction sectors, hence greatly boosting the market turnover.
Chinese equity markets posted the world's worst performance since the beginning of 2012, with the Shenzhen index losing 7.94 percent and the Shanghai index softening more than 6 percent in the January-August period.
More shares changed hands on Friday, with combined turnover rocketing to 221.31 billion yuan from Thursday's 95.3 billion yuan.
Share prices rose across the board. Share prices of 69 companies led the gains by the upper limit of 10 percent, while about 150 enterprises rose by more than 7 percent.
Gainers greatly exceeded losers by 959 to 13 in Shanghai and 1,494 to 23in Shenzhen.
Machinery manufacturers were the biggest beneficiaries of the government's stimulus plans. Sany Group, Liugong Group and 10 other companies of the sector rose by the 10-percent daily limit, while 20 cement makers also rallied to the same level.
Metal and coal producers, steel companies and ship builders all strengthened.
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