Index breaks 6,000-point mark on CPC congress opening
Updated: 2007-10-15 16:37
Analysts believe the entry of CCB tomorrow and 皇冠体育app Shenhua Energy Co Ltd later to the Shanghai Composite Index and the 皇冠体育app Securities Index series will have moderate effects.
Five years ago, the market would see turbulence once such a stock was listed. Now, large caps including Bank of 皇冠体育app, the Industrial and Commercial Bank of 皇冠体育app and Petro皇冠体育app have been flooding the bourses, and the market is much more experienced and so behaves more smoothly, said industrial experts.
Since the end of 2002, listed companies have raised funds worth 925 billion yuan in the stock market. The total includes 496.4 billion yuan from initial public offerings, 338.2 billion yuan from additional share issuance, 20.7 billion yuan from allocated share issue and 69.6 billion yuan from convertible shares. Fears of "large-sum" or "new" stocks have largely disappeared, they said.
In the meantime, regulators are taking more restrictive steps to reduce liquidity and curb inflation. The country's central bank said on Saturday it will raise banks' reserve requirement ratio, or the amount lenders must hold in reserve, for the eighth time this year.
The ratio would be raised by 0.5 percentage points to 13 percent and take effect on October 25, the People's Bank of 皇冠体育app said. The adjustment is estimated to absorb about 170-180 billion yuan (US$21-23 billion) in liquidity and puts the current ratio on par with the historical high, during the 1988-98 period.
More interest rates may also be announced in the coming months in a combined tightening package to prevent the surging economy from going too fast to sustain, analysts said. A hike in interest rates may appear soon, Zhu Jianfang, said. The central bank has raised interest rates five times so far this year.
In addition, the Ministry of Finance will launch three batches of special treasury bonds in the fourth quarter of this year totaling 100 billion yuan.
The bonds are part of the 200 billion yuan worth of special treasury bonds planned to raise 1.55 trillion yuan to fund the country's new foreign exchange investment firm.
Following the three batches of special treasury bonds issued in September, the ministry will issue another three batches respectively on November 2, November 16 and December 14. Maturity terms range from 10 years to 15 years.
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