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Stocks edge up amid price correction

By Li Zengxin (chinadaily.com.cn)
Updated: 2007-06-19 15:46

After 10 days of growth, the stock market has recovered from the loss by the stamp tax hike on May 29. By yesterday, the total market value of all securities in the two stock exchanges was 18,515.7 billion yuan, surpassing that of May 30 and close to May 29.

On the other hand, the consecutive surges in share prices last week didn't bring more new investors in the A-share market, as daily new A-share account opening was mostly kept below the 200,000 mark. Instead, a rush to subscribe for the four new mutual funds was seen with a steady growth in fund accounts. The four funds raised over 100 billion yuan, refreshing previous record volumes for a single week.

New Account Opening
Source: China Securities Depository and Clearing Co Ltd

Date

A share

B share

Fund

Total

2007-06-11

212,746

2,274

27,105

242,125

2007-06-12

182,020

2,118

34,927

219,065

2007-06-13

187,145

2,107

139,372

328,624

2007-06-14

192,174

1,882

74,794

268,850

2007-06-15

190,202

2,060

63,378

255,640

The year-long bull market has also led to a frenzy of speculation. The China banking regulator said Monday it has punished some local branches of eight banks for failing to prevent two clients from misappropriating loans of 4.46 billion yuan, of which 2.5 billion yuan was believed to have been invested in the stock market for higher returns from initial public offering (IPO) subscriptions.

The eight banks concerned are the Bank of Beijing, the Beijing branch of Bank of Communications and the Shanghai outlets of China Merchants Bank, the Industrial and Commercial Bank of China, China CITIC Bank, Bank of China, the Industrial Bank and Shenzhen Development Bank.

There is good news for banks though. China's city commercial banks will lead the next listing waves, after most of the State-owned commercial banks have already gone public. Bank of Nanjing and Bank of Ningbo will be the first ones to be examined by the China Securities Regulatory this Friday.

Bank of Beijing has also filed its application for IPO to the commission. Hangzhou City Commercial Bank, Chongqing Commercial Bank and Bank of Shanghai are in the preparation process. City commercial banks of Xi'an, Nanchong, Jinan and Tianjin also expressed their willingness to issue A shares.

The red-chip returning wave saw China Mobile as the latest move yesterday. The world's largest cellular phone operator is planning a multibillion-dollar share sale in Shanghai as early as next month to attract domestic investors. The deal could raise as much as 80 billion yuan (US$10.49 billion), sources familiar with the situation said on Monday.


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(For more biz stories, please visit Industry Updates)



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