The Shanghai Composite Index, which tracks the movement of both yuan-denominated Class-A shares and hard-currency Class-B shares, closed at 1521.44 on April 30, the last trading day before the closure.

The market has already given up nearly 10 percent of gains over the past month as the spread of SARS worried investors, prompting them to sell shares to hedge against possible economic uncertainty.

"The impact of SARS cannot be removed from the mind of investors immediately and SARS would still play a big role in exerting its influence upon the market for the short term," said Wu Jie, a dealer with Kinghing Securities Co Ltd. "If the spread of the epidemic can't be checked or stemmed, the market will be in weak shape."

To prevent SARS from spreading in more than 2,800 trading outlets across the country, the China Securities Regulatory Commission ordered a hold on trading, extending the break to nine days from the scheduled six days for the Labor Day holiday.

Although the respiratory disease, which is believed to be caused by a new type of coronavirus, has hurt many sectors, such as tourism and aviation, some industries are benefitting.

Medical stocks look strong as people spend more on tonics and drugs to guard against the virus.

Shares of Shandong Lukang Pharmaceutical Co Ltd, an antibiotic manufacturer, rose nearly 7 percent over the past month to close at 7.82 yuan (94 US cents) before trading was halted and Beijing Wandong Medical Equipment Co Ltd surged 10 percent in the period to close at 12.33 yuan.

However, analysts warned of profit-taking due to the handsome gains the sector has made.

"If I held medical stocks, the first thing I would do is to sell. You had better turn the profit into cash now," said Wu.

Analysts say there are still some bargains in the market, including some e-commerce companies that have seen business boom as people avoid crowded shopping malls.

For instance, shares of Shanghai Maling Aquarius Co Ltd, which owns an online shopping center, remain low at 9.78 yuan.

Analysts also predict that the auto sector, which is already doing well due to strong demand, is likely to creep into higher territory in anticipation of more inspiring sales figures, as more people are now mulling over buying private cars to avoid using public transportation.

(Shanghai Daily May 12, 2003)