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China shares gain despite fall in consumer prices

China shares gain despite fall in consumer prices

Chinese shares rebounded Tuesday after a three-day decline as investors shrugged off news that consumer prices fell in February.
The benchmark Shanghai Composite Index jumped 39.82 points, or 1.9 percent, to close at 2,158.57. The Shenzhen Composite Index for China's smaller second exchange rose 1.9 percent to 699.8.
Analysts said the markets were due for a correction following sharp losses in previous sessions. They said investors were not put off by news that consumer prices fell 1.6 percent in February, even though deflation usually hurts stock prices.
The fall in the consumer price index, the first in more than six years, underscored weakness in the world's third-largest economy, but officials downplayed the risk of a deflationary spiral.
"Investors tended to interpret the bad figure in a good way since there is no other worse news," said Chen Jinren, an analyst for Huatai Securities in the eastern city of Nanjing.
Nonferrous metal and cement makers rose strongly.
Jiangxi Copper Ltd., the country's second-largest metal producer, increased 3.7 percent to 16.69 yuan; Huludao Zinc Industry Co. soared 6.5 percent to 5.22 yuan, while Aluminum Corp. of China, also known as Chalco, added 1.8 percent to 9.18 yuan.
Taihang Cement Co. climbed 2.7 percent to 6.89 yuan and Fujian Cement Co. added 3.2 percent to 6.2 yuan.
Real Estate developers fell after the government reported housing prices in 70 major cities fell by 1.2 percent year-on-year in February.
The country's biggest developer, China Vanke Ltd., which earlier reported a 17 percent profit decline for 2008, gave up 1 percent to 7.8 yuan. China Merchants Property Development Co. lost 2.7 percent to 19.85 yuan.
In currency markets, China's yuan strengthened to 6.8402 to the U.S. dollar, up from Monday's close of 6.84211.


Updated : 2021-04-19 18:31 GMT+08:00