Again shrugging off the threat of further economic tightening by the government, analysts are calling for China's Shanghai Composite Index to continue its climb when the market opens for business on Monday. Last week, data revealed that the Chinese economy expanded by 11.5 percent in the third quarter. Also, China's September inflation index rose 6.2 percent on year and now stands at 4.1 percent over the first three quarters of 2007 - further fueling expectations of an interest rate increase, although the market ignored the reports Friday and closed higher. For the day, the index added 27.23 points or 0.5 percent to close at 5,589.63. There were 412 stocks that saw decline and 357 that posted gains, with 77 stocks remaining unchanged. Most of the sectors finished higher as Minsheng Bank jumped 4.7 percent, China Merchants Banks rose 4 percent, property firm China Vanke gained 4.9 percent and Poly Real Estate Group rose 5.7 percent. However, airlines were drag on the index as China Southern Airlines Co, the nation's biggest carrier, retreated 4 percent, Air China, the world's biggest airline by market value, lost 4.09 percent and China Eastern declined 6.65 percent. Wall Street provides positive cues from Friday after strong third quarter results from Microsoft pushed the market higher. The major average spent the entirety of the trading session in positive territory, climbing in late day to end just shy of their intraday highs. The Dow rose 134.78 points, or 0.99 percent, to close at 13,806.70. Standard & Poor's 500 index gained 20.88 points, or 1.38 percent, to end at 1,535.28, while the Nasdaq saw the greatest percentage gain, rising 53.33 points, or 1.94 percent, to close at 2,804.19. In economic news, foreign trade in China is seen climbing by 20 percent to more than US$2.1 trillion in 2007, according to data released by the Ministry of Commerce. The export volume is expected to hit US$1.2 trillion and the import volume should check in around US$950 billion for a trade surplus of US$250 billion. For the first three quarters of 2007, exports rose 27.1 percent on year to US$878.2 billion. Imports were up 19.1 percent to US$692.6 billion. The report also projects China's trade volume to increase by another 1.5 percent in 2008 to more than US$2.4 trillion. In corporate news, PetroChina Co., China's largest oil and gas producer by capacity, has seen its a-share public offering has drawn a record 3.3 trillion yuan in subscription funds, the company announced Monday. The company is looking to raise at least 66.8 billion yuan in its domestic share offering, which could make it the largest IPO in the Chinese market's history. Also, Japanese giant Nintendo expects to launch its very popular Wii console in China and South Korea starting in 2008 in an effort to cement its lead over the competition. For the year, the Wii has been outselling both the Xbox 360 and the PlayStation 3 by a wide margin to become the best selling next-gen console in the market. Finally, China Construction Bank Corporation posted an unaudited third quarter net profit of 22.85 billion yuan. For the first nine months of 2007, the bank made a net profit of 57.10 billion yuan. For the period of July to September, the bank earned a net interest income of 50.09 billion yuan and an operating profit of 33.13 billion yuan.
October 28, 2007 8:49 PM