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China's shares ended slightly higher yesterday, with most investors on the sidelines as the Lunar New Year break approached, although some chose to take quick profits, brokers said.
Shanghai's composite index inched up 4.48 points to 1,500.64, the highest close since November 11, 2002. Shenzhen's shares closed up 12.59 to 3,044.03.
Shanghai's B-share index tiptoed 0.32 percent higher to 127.939 points while Shenzhen's rose 0.68 percent to 208.77.
Turnover on the hard currency B-share markets, open to foreign and Chinese investors, was only US$12.8 million in Shanghai, down 36 per cent from Monday, and HK$84 million (US$11 million) in Shenzhen, down 9 percent.
Analysts said most investors were content to sit out the session.
"Investors were reluctant to trade shares as the long holiday is nearing," said China Galaxy Securities analyst Ren Chengde.
"The Shanghai composite index ending above 1,500 points in thin trade indicated investors wanted to hold shares over the holidays and that market sentiment was strengthening," said Ren, referring to a psychologically important level.
China's stock markets will be closed from tomorrow for the important Lunar New Year holidays. They will reopen on February 10.
Monday's top gainer, Jinli Technology (Agricultural) Co, a hi-tech agricultural products maker based in Central China's Hunan Province, was the biggest A-share decliner in Shanghai, falling 3.44 percent to 17.10 yuan (US$2).
On the B-share market, chicken breeder Shanghai Dajiang Group, which lost money in the first nine months of 2002 as well as in 2001 and 2000, led by volume and was the second biggest gainer in Shanghai.
Its B shares climbed 0.98 percent to finish at 52 US cents, with 5.9 million shares changing hands.
Home appliance maker Tsann Kuen Enterprise Co was the biggest gainer in Shenzhen, rising 3.29 percent to HK$4.39 (56 US cents).
Analysts said they expected the composite index would continue to rise after the holidays.
"The market is forging upward," said Huatai Securities analyst Chen Huiqing.
"We don't expect the index to fall below 1,475 points again in the short run," she added, referring to a near-term support.
China Minsheng Banking Corp, the country's sole non-State bank, closed 2.4 percent up at 10.57 yuan (US$1.30) after the company announced a net profit of 884.6 million yuan (US$107 million) for 2002, up from 608 million yuan (US$73 million) the year before.
The bank said in a statement published in official securities newspapers yesterday that its 2002 earnings per share were 0.34 yuan (4 US cents), up from 0.29 yuan (3.4 US cents) a year earlier.
The medium-sized lender attributed the rise in profits to an expansion of its core loans business.
On the foreign exchange market, China's yuan ended up one notch at 8.2767 against the US dollar, buoyed by ample dollar supply.
The yuan moved narrowly between 8.2766 and 8.2769 yesterday, near the strong end of the trading range of 8.2760 and 8.2800 enforced by the central People's Bank of China. Turnover was not available yesterday but it was heavy at $880 million on Monday.
"The major factor supporting the yuan today was ample dollar supply on the foreign exchange market," said a bank dealer.
Central bank governor Zhou Xiaochuan told a conference in Beijing over the weekend that the government would keep the exchange rate of its yuan currency stable this year, in line with statements made by other Chinese officials.
Central bank officials have said the yuan's trading range could be widened in the long-term to help counter any impact on trade and investment from China's accession to the World Trade Organization in late 2001. But they have given no timetable.
The yuan is not fully convertible under the capital account and its movements within the government-set trading box is basically decided by China's trade performance.
(China Daily January 29, 2003)
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