Tuesday, January 15, 2013

China stock market rose january 15 2013

Stock market today - China stock market rose january 15 2013 : China's shares ended higher Tuesday, boosted by gains in green companies as investors continued to bet that Beijing may spend more to address the country's environmental woes after the capital city experienced its worst air pollution in recent years over the weekend.

The benchmark Shanghai Composite Index, which tracks both A and B shares, ended up 0.6% at 2325.68, extending a 3.1% rise in the previous session. The Shenzhen Composite Index rose 1.6% to 932.55.

With a 3.7% rise in the past two sessions, analysts said the market may see some consolidation in the near term as profit-taking may kick in after the market's recent gains.

"Investor sentiment saw a turnaround Monday after Guo Shuqing's comments, but given we saw such a sharp gain in just two sessions, the market may need some pause before it can go further north," said Shanghai Securities analyst Peng Yunliang.

Guo Shuqing, chairman of the China Securities Regulatory Commission, said Monday that China could substantially increase the quota allowed for foreign investors to invest in domestic equity markets.

In the medium term, "we expect investors to continue to favor environment protection-related stocks as well as water conservatory stocks as Beijing emphasizes air quality and upgrades of the underground water system," Mr. Peng added.

Tianjin Capital Environmental Protection Group was 10% limit-up at CNY5.36, Beijing Capital rose 5.2% to CNY4.64, and Beijing SPC Environment Protection Tech was also limit-up 10% at CNY19.56.

At the same time, concerns over rising inflation, after consumer prices in December accelerated faster than expected, may also cap any potential gains in the near term.

"After all, comments from Guo Shuqing (yesterday) only served some psychological purpose, and they didn't really change anything in market fundamentals, so we expect the market to consolidate with a downward bias in the near term," said Minsheng Securities analyst Zhang Lei.

Separately, Deutsche Bank said it remains positive on China's banks after recent group meetings with the management teams of China Construction Bank, AgBank and China Merchants Bank.

The house said profit guidance for 2012 was stronger than it had expected, given resilient net interest margin in the fourth quarter due to tight sector liquidity and improving loan pricing, recovering fee income, and largely stable asset quality.
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