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Chinese shares rise, buoyed by fund approval, return of IPO funds to market

Chinese shares rise, buoyed by fund approval, return of IPO funds to market

Chinese stocks rose Friday as the approval of a new fund boosted sentiment and money locked in subscriptions to a share offering by China Railway Construction returned to the market.
The benchmark Shanghai Composite Index climbed 1.1 percent, or 49.03 points, to 4,348.54. The Shenzhen Composite Index rose 1.3 percent to 1,373.89.
"Investor confidence hasn't fully recovered from the sharp drops seen recently," said Zhou Lin, an analyst at Huatai Securities. "So it's difficult to say which direction the market will head next."
The benchmark index fell 4.1 percent Monday to a seven-month low of 4,192.53, mainly on concerns over an oversupply of shares due to corporate fundraising plans. But it regained most of the lost ground during the week after China's securities regulator urged companies to carefully consider their share offering plans.
The China Securities Regulatory Commission's approval of a new fund management joint venture between Agricultural Bank of China, a Credit Agricole unit and Aluminum Corp. of China, disclosed late Thursday, also spurred buying.
"The approval indicates the government has become more active in supporting the market," said Li Xianming, an analyst at Ping An Securities.
Among the blue chip gainers, SAIC Motor, which fell sharply early this week, rose 1.6 percent to 18.85 yuan and Ping An Insurance (Group) Co. of China rose 1.7 percent to 71.20 yuan.
Airlines rose due to the strengthening Chinese currency, which helps reduce their U.S.-dollar denominated debt.
Shanghai Airlines rose 5.3 percent to 12.00 yuan and Air China rose 6.1 percent to 19.40 yuan.
The U.S. dollar hit another record low against the Chinese yuan Friday, falling to as low as 7.1045.
The dollar was at 7.1108 around 0730 GMT on the over-the-counter market, down from Thursday's close of 7.1133.


Updated : 2021-05-17 19:13 GMT+08:00