FROM SCRATCH NEWSWIRE

SCAVENGING THE INTERNET

CHINA SHARES UP AS ROAD-BUILDING PLANS REVEALED

Posted by Gilmour Poincaree on November 27, 2008

Published: Nov 26, 2008 03:44 AM

The Associated Press

SHANGHAI, China – China’s shares edged up Wednesday for the first time in five sessions, led by In July 7, 2008 photo, an investor looks at a stock price board at a private securities' company in Shanghai, China. Chinese shares fell sharply Friday, Aug. 8, 2008, on heavy selling of airlines and other market heavyweights, as investors and analysts puzzled over why expectations of a rally linked to the Beijing Olympic games never materialized. The benchmark Shanghai Composite Index sank 4.5 percent, or 122.81 points, to 2,605.16. The Shenzhen Composite Index of China's smaller, second market dropped 5.6 percent to 74transportation and steel stocks after the government announced road-building plans under a stimulus package.

The benchmark Shanghai Composite Index ended up 0.5 percent, or 9.17 points, to close at 1897.88. The Shenzhen Composite Index for China’s smaller second exchange rose 0.6 percent to 535 points.

Trading was thin, reflecting the market’s search for direction after a rally – prompted by Beijing’s Nov. 9 announcement of its stimulus package – faded, analysts said.

“If the policies become clearer, the euphoria could continue,” said Huang Xiangbin, an analyst for Cinda Securities.

Stocks in toll road operators and steel makers rose after the Ministry of Transport said it would spend 1 trillion yuan ($146 billion) on building highways and rural roads as part of the stimulus.

The package is meant to help shield China from the global downturn by pumping money into the economy through higher spending on construction, tax cuts and aid to the poor.

Guangxi Wuzhou Communications Ltd. advanced by the daily limit of 10 percent to 4.62 yuan, while Jiangxi Ganyue Expressway Co. jumped 2.9 percent to 8.15 yuan.

Steel stocks rose after iron ore supplier BHP Billiton Ltd. dropped its bid for rival Rio Tinto Group, which eased concerns that a tie-up would give the mining group too much leverage to raise prices.

Baoshan Iron & Steel Ltd., China’s biggest steel maker, gained 3.9 percent to 5.02 yuan. Anshan Iron and Steel Group rose 6 percent to 7.1 yuan.

Real estate stocks rose on expectations of a possible interest rate cut, despite comments by a central bank deputy governor who said the current level is appropriate.

China Vanke Ltd., the country’s biggest developer, climbed 3.7 percent to 6.8 yuan, and rival Poly Real Estate Group rose 2.6 percent to 17.38 yuan.

In currency markets, China’s yuan weakened to 6.8282 to the U.S. dollar in over-the-counter trading around 0800 GMT, down from Tuesday’s close of 6.8220.

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PUBLISHED BY ‘THE NEWS & OBSERVER’ (USA)

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