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Chinese stocks close at fresh record high on earnings optimism

Chinese stocks close at fresh record high on earnings optimism

Chinese stocks closed at a fresh record high Friday, with airlines and steel makers soaring on expectations of strong corporate earnings.
The benchmark Shanghai Composite Index gained 50.94 points, or 1 percent, to 5,218.83 _ the first time it has closed above 5,200.
The Shenzhen Composite Index rose 1.3 percent to 1,457.83, also a record close.
"Chinese stocks aren't cheap but local investors still like to put their savings into the stock market, as improved corporate earnings lead them to believe they will make more money from equity investments," said Xu Yinhui, an analyst at Guotai Junan Securities.
The combined net profit of China's 1,471 listed companies jumped 71 percent in the first half of the year to 319 billion yuan (US$42 billion;euro31 billion), according to data collated and reported by the state-run newspapers China Securities Journal and Shanghai Securities News.
Airlines were among the day's biggest gainers on speculation over more merger activity in the sector after flagship Air China said earlier this week Beijing is considering a restructuring of its civil aviation industry to boost efficiency.
Air China, China Southern Airlines and Shanghai Airlines all surged by the 10 percent daily limit, with Air China closing at 19.20 yuan, Southern Airlines at 20.79 yuan and Shanghai Airlines at 13.93 yuan. Hainan Airlines jumped 7.7 percent to 10.52 yuan.
Steel companies also rose after Baoshan Iron & Steel, China's largest steel maker, said late Thursday it will increase its annual capacity through mergers and acquisitions to 50 million tons by 2012 from its current 22 million tons.
Baoshan Iron & Steel rose 5.2 percent to 18.49 yuan, Tangshan Iron & Steel gained 5.9 percent to 20.90 yuan, and Fushun Special Steel soared by the 10 percent daily limit to 11.17 yuan.
In currency dealings, the Chinese yuan edged lower against the U.S. dollar after its official rate was set lower Friday.
The dollar was at 7.5419 around 0730 GMT, up from Thursday's close of 7.5410.


Updated : 2020-11-30 01:38 GMT+08:00