US toxic asset scheme boosts key stock index

SHANGHAI'S key stock index closed higher yesterday for a seventh day, boosted by the United States market's gains on the unveiling of a toxic asset plan. The Shanghai Composite Index added 0.56 percent to 2,338.42.

"Shares opened higher on rises in the US market but the index saw some turbulence amid profit taking from gains in the local bourse," GF Securities Co wrote. "Though the local benchmark index closed higher (yesterday) it is possible a correction will come later. But the local market's overall strong performance would not change easily as investor confidence seemed to have recovered."

The US stock market saw an average rise of over 6.5 percent on Monday after the US government announced plans to help banks dispose of their toxic assets.

PetroChina and Sinopec gained as oil prices rose to a four-month high.

PetroChina gained 0.94 percent to 11.77 yuan (US$1.72) and Sinopec added 0.8 percent to 8.87 yuan.