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Mainland stocks soar 9.3pc after stamp duty cut
Mainland shares soared 9.3 percent yesterday -
their biggest one-day gain in more than six years - after regulators gave
in to the wishes of speculators and slashed stamp duty to prop up the
sagging market.
Morgan Stanley analyst Jerry Lou said investors view the move as
evidence of the central government's determination to rescue the market.
The Shanghai Composite Index closed at 3,583.02, up 304.69 points - its
biggest one-day jump since rising 9.9 percent on October 23, 2001. It
earlier climbed as high as 9.6 percent.
Only one of the 888 stocks on the index fell yesterday, while more than
500 surged to hit the 10 percent daily limit.
Turnover in Shanghai A shares more than doubled to 188.5 billion yuan
(HK$209.23 billion).
Meanwhile, the Shenzhen Composite Index climbed 8.7 percent to
1,043.79, up 83.58 points.
The CSI 300 Index of A shares surged 9.3 percent - the biggest jump on
record - to 3,774.50, up 320.78 points.
Hongkong and Shanghai Banking Corp executive director Peter Wong Tung-shun
said Beijing may consider further actions to prop up the mainland market
if necessary.
"While the mainland continues to regulate against inflationary
pressures, they do not want to blow up personal balance sheets with a
collapsing A-share market," Deutsche Securities wrote in a trading
note.
The timing of the stamp duty reduction suggests policymakers do not
want the Shanghai index to fall below 3,000 points, said Citi analyst Ken
Peng.
Goldman Sachs analysts said the upside in the mainland markets lies
between 15 and 25 percent from Wednesday's levels.
In Hong Kong, the Hang Seng Index rose 1.6 percent, or 391.54 points,
to close yesterday at 25,680.78.
Main board turnover was HK$130.26 billion, up from HK$105.3 billion. 2008-04-26 |
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