Investors continue rally in Shanghai

SHANGHAI stocks rose yesterday, the fourth session in a row, as investors continued the rally in the new year.

The benchmark Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B shares, gained 0.59 percent to 5,393.34, but it was off an intraday high of 5,403.35.

Turnover in Shanghai A shares rose to 161.4 billion yuan (US$22.2 billion), from Friday's 144.7 billion yuan, and analysts cited active market sentiment and abundant liquidity for the increase.

"The market is maintaining a strong stance although the index didn't post a significant rise. The number of stocks that surged to their daily limits was also big," said Donghai Securities analyst Wang Xingjun.

Property and some bank stocks performed strongly as the yuan rose to the highest against the US dollar after the scrapping of a peg in July 2005. A stronger yuan can boost asset values of these firms.

Poly Real Estate Group Co added 0.48 percent to close at 68.69 yuan.

Shanghai Pudong Development Bank, part-owned by Citigroup, jumped 5.62 percent to 55.99 yuan while Industrial Bank Co rose 3.94 percent to 52.7 yuan.

Among the gainers were chemical stocks amid a positive industry outlook, traders said. Zhejiang Ju Hua Co soared to the 10 percent daily limit to end at 16.51 yuan while Shanghai 3F New Materials Co also jumped 10 percent to 14 yuan. Tangshan Sanyou Chemical Industries Co surged 8.86 percent to 23.21 yuan.

China Railway Group Ltd surged 8.4 percent to 12.39 yuan after it won deals worth 22 billion yuan of Beijing-Shanghai high-speed railway project.

China Shipping Development Co sailed 6.58 percent higher to 40.82 yuan after saying in its preliminary earnings results that its 2007 net profit jumped 65.45 percent from a year earlier.