Shanghai's hard currency B-share index nudged up 0.67 percent to 122.465 points, while Shenzhen's rose 1.5 percent to 203.07.

Coal producer Zhengzhou Coal Industry & Electric Power Co was the best A-share performer in Shanghai, with the value rising almost 10 percent to 8.17 yuan (US$0.98).

Global oil prices have been volatile in the run-up to, and during the Iraq war. Expectations of a drawn-out conflict led most Chinese investors to believe that firm global oil prices could go still higher, analysts said.

"Rallies in coal counters reflected punters' concern that high oil prices might push more users to choose coal," said Yu Xiaoli, an analyst at Huatong Securities.

Yu also said she expected the overall Shanghai market to hover around 1,500 points in the short run as market sentiment remained cautious during the annual corporate reporting season.

The benchmark Shanghai composite index, which groups both B and A shares, rose 18.637 points or 1.25 percent to end at 1,510.578, while the Shenzhen sub-index also soared 53.25 points or 1.75 percent to close at 3,101.86.

"But it is unlikely the composite index would fall below the psychologically important 1,450 point-level again, as firms with good earnings will give support to investors' confidence to the broad market," she said.

Yesterday, investors favored firms that posted a rise in their 2002 earnings.

Sinopec Corp, China's number two oil producer, reported a 0.34 percent rise in its 2002 net profit on Sunday, countering analysts predictions of a fall.

Its A shares rose 2 percent to 3.60 yuan (US$.4337) with 43.4 million shares changing hands - Shanghai's second most active stock.

Another heavyweight, Pudong Development Bank, in which US financial giant Citigroup Inc has invested, also outperformed the market with a 1.9 percent rise to 11.15 yuan (US$1.3433).

Shanghai's yuan-denominated A-share index gained 1.26 percent to 1,579.797 points, while its Shenzhen counterpart rallied 1.10 percent to 446.97.

(China Daily April 1, 2003)