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Chinese stocks rise, with banks leading rebound; yuan falls against dollar

Chinese stocks rise, with banks leading rebound; yuan falls against dollar

Chinese stocks rose Friday, with banks surging on expectations of strong demand next week, helping the market reverse a steep fall early in the session.
The benchmark Shanghai Composite Index gained 0.9 percent to 2,882.56, after falling 4 percent Thursday and another 4.8 percent earlier in the day. The Shenzhen Composite Index rose 1.2 percent to 683.98.
Some traders used rumors of an imminent interest rate hike as an excuse to take profits early Friday, analysts said.
But the decline was offset by buying triggered by expectations of massive money flowing back into the market next week after the lock-up period for subscriptions to Industrial Bank's initial public offering ends next week, they said.
Thursday's decline was prompted by fears regulators might tighten credit to cool the economy. But those worries appeared to be short-lived.
"It seems that regulators won't take any cooling step targeting the stock market other than quickening the pace of IPOs in the near term," said Yang Weicong, a strategist at United Securities.
Banks soared Friday as they are most likely to be favored by funds that subscribed to Industrial Bank's IPO, said Zhao Jianxing, an analyst at China Merchants Securities.
China Minsheng Banking climbed by the daily limit of 10 percent to 12.84 yuan, Hua Xia Bank jumped 10 percent to 10.08 and Shanghai Pudong Development Bank advanced 9.1 percent to 26.58.
China's No. 1 lender, Industrial & Commercial Bank of China, slipped 0.4 percent to 5.26 yuan. An institutional tranche of 2.35 billion of the bank's shares were due to begin trading Monday.
Bank of China, down 6.4 percent over the past two days, gained 1.3 percent to 4.85 yuan as bargain hunting offset an early decline.
In currency dealings, the dollar's rebound against the Japanese yen pushed the Chinese yuan lower.
The dollar was at 7.7777 on the over-the-counter market at around 0730 GMT, up from Thursday's close of 7.7705.


Updated : 2021-05-07 20:41 GMT+08:00