Analysts predict the Shanghai stock market will rise this week
while investors' buying interest in a wider range of sectors will
also be a catalyst for the index to climb.
The Shanghai Composite Index, which covers yuan-denominated A
shares and hard-currency B chips, rose 1.9 percent in the first
trading week of 2008 to end at 5,361.57, above the 60-day moving
average of 5,347.
"The stock market started the New Year on a strong note," said
Qian Qimin, a Shenyin Wanguo Securities analyst. "The 1.9-percent
rise was not quite big but we saw active trading among many
individual stocks such as Olympics-related, retail and beverage
issues and investors had a wider choice of stocks to invest
in."
Shenyin Wanguo sees a target of 5,300 to 5,500 points for the
key Shanghai index this week. Southwest Securities forecasts a
range from 5,300 to 5,400 while Shanghai Securities says it may
move between 5,200 and 5,500. China Galaxy Securities says the
index may challenge 5,600 this week.
Analysts said expectations for better corporate earnings and
abundant capital available in the market could also propel the
index higher.
As high as 76 percent of the 596 listed companies that have
released preliminary earnings forecast said their profit for last
year would rise, according to Everbright Securities.
Domestically-listed companies will start to report annual results
from January 15.
Analysts said the index should fluctuate around the 60-day
average in coming sessions, adding that the strong turnover last
week suggests the barometer could sustain another round of rises.
The daily turnover on the Shanghai and Shenzhen bourses has hovered
at more than 200 billion yuan (US$27.5 billion), double the figure
in the last two months of last year.
Shanghai Securities analyst Yang Ming suggests that investors
may favor gold, copper and oil producers.
(Shanghai Daily January 7, 2008)
