China stocks boosted by builders

Statis­tics bureau says profit growth at in­dus­trial firms ac­cel­er­ated last month

China Daily (Hong Kong) - - BUSINESS - By BLOOMBERG

China’s State-backed builders ex­tended a rally on Tues­day while en­ergy firms dropped, amid thin year-end trad­ing in the world’s sec­ond­biggest stock mar­ket.

The Shang­hai Com­pos­ite In­dex closed 0.3 per­cent lower at 3,114.66. China Gezhouba Group Co and Shang­hai Tun­nel Engi­neer­ing Co rose, while the coal miner Guanghui En­ergy Co slipped. The Shen­zhen Com­pos­ite In­dex added 0.1 per­cent. Hong Kong’s mar­kets were closed as the city wrapped up a four-day hol­i­day week­end.

Profit growth at in­dus­trial firms in China ac­cel­er­ated last month, the Na­tional Bureau of Statis­tics said on Tues­day, a day af­ter the Min­istry of Trans­port helped lift shares in con­struc­tion firms by an­nounc­ing plans to spend 1.8 tril­lion yuan ($259 bil­lion) on high­ways and water­ways in 2017.

The gov­ern­ment will also pro­mote as­set se­cu­ri­ti­za­tion in pub­lic-pri­vate part­ner­ship projects in in­fra­struc­ture, the Na­tional De­vel­op­ment and Re­form Com­mis­sion and the se­cu­ri­ties reg­u­la­tor said on Mon­day.

“The joint no­tice ... was be­yond mar­ket ex­pec­ta­tions and should be a cat­a­lyst for fur­ther de­vel­op­ment of pub­lic-pri­vate part­ner­ship projects next year,” said Zhou Song, Shang­hai-based an­a­lyst at Chang jiang Se­cu­ri­ties Co.

“It would help make the projects more at­trac­tive to pri­vate cap­i­tal, which in turn sup­ports in­fra­struc­ture con- struc­tion.”

In­dus­trial prof­its rose 14.5 per­cent in Novem­ber from a year ear­lier to 774.6 bil­lion yuan, the statis­tics bureau said. That com­pared with the 9.8 per­cent in­crease in Oc­to­ber. Earn­ings in the first 11 months climbed 9.4 per­cent to 6.03 tril­lion yuan.

Dam builder and ce­ment pro­ducer China Gezhouba Group ad­vanced 2.6 per­cent, Shang­hai Tun­nel Engi­neer­ing rose 1.9 per­cent, China Rail­way Con­struc­tion Corp added 0.8 per­cent while Guanghui En­ergy and Shaanxi Coal In­dus­try Co slipped 0.4 per­cent.

Bench­mark Qin­huang­dao coal prices fell for a sev­enth week to an av­er­age of 639 yuan per met­ric ton, ac­cord- ing to data from the China Coal Trans­port & Dis­tri­bu­tion As­so­ci­a­tion.

Shang­hai’s bench­mark gauge has fallen 4.2 per­cent in De­cem­ber, par­ing its gains for the fourth quar­ter to 3.7 per­cent. The in­dex is down 12 per­cent in 2016, set for its big­gest loss in five years.

Vol­ume on the CSI 300 was 46 per­cent lower than the 30-day av­er­age for the time of day.

Sealand Se­cu­ri­ties Co has signed agree­ments with seven in­sti­tu­tions in­volved in a scan­dal re­lated to bonds with forged seals, ac­cord­ing to a state­ment given to the Shen­zhen Stock Ex­change. The com­pany plans to sign pacts with other par­ties as soon as pos­si­ble.

It would help make the projects more at­trac­tive to pri­vate cap­i­tal, which in turn sup­ports in­fra­struc­ture con­struc­tion.” Zhou Song, a Shang­haibased an­a­lyst at Changjiang Se­cu­ri­ties Co

Trad­ing in the com­pa­nies’ shares has been halted since a for­mer em­ployee was found to have forged a seal to con­duct bond trad­ing, an episode that has wor­ried the bond mar­ket. A sim­i­lar prob­lem has been found at China Guangfa Bank.

The Hang Seng In­dex has lost 5.3 per­cent in De­cem­ber and tum­bled 7.4 per­cent in the fourth quar­ter. The gauge is down 1.6 per­cent this year.

Hong Kong may re­port 34,700 reg­is­tered sales of used-homes in 2016, fewer than the 2003 low of 35,630, Cen­taline Prop­erty Agency said on Mon­day. A mea­sure of prop­erty com­pa­nies listed in the city has fallen for 10 days, its long­est los­ing streak since Au­gust 2015.

AP

Peo­ple wait to cross a street in front of an elec­tronic stock in­di­ca­tor of a se­cu­ri­ties firm in Tokyo. Shares are mixed in Asia as the last week of trad­ing for the year be­gan on Tues­day af­ter most mar­kets were closed for Christ­mas. In the Chi­nese main­land stock mar­ket, the bench­mark Shang­hai Com­pos­ite In­dex de­clined 0.3 per­cent on Tues­day.

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