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China stocks close higher on Tuesday

China stocks close higher on Tuesday

Write: Antipholus [2011-08-24]

Heavyweights lifted China's stocks on Tuesday after consecutive falls in the previous five trading days. The benchmark Shanghai Composite Index closed up 1.52 percent, or 38.16 points, to 2,554.02.

The Shenzhen Component Index rose 1.18 percent, or 130.78 points, to finish at 11,243.42.

Combined turnover rose slightly to 128.26 billion yuan (20.04 billion U.S. dollars) from 127.05 billion yuan on the previous trading day.x Gainers outnumbered losers 862 to 50 in Shanghai and 1246 to 77 in Shenzhen.

Strong expectations that U.S. stimulus policies may reduce the possibility of further interest hikes domestically soothed the A-share market, said Zhang Daqing, a fund manager with Bosera Funds, a top fund managing company in China.

Still, future market trends remain unclear, as HSBC said on Tuesday that its preliminary purchasing managers index (PMI) stood at 49.8 points, indicating a contraction despite rising from 49.3 points in July.

Qu Hongbin, HSBC's chief China economist, said the hard landing risk for China's economy is very low, which provides room for the central bank to maintain its current tightening measures.

Property and financial heavyweights both helped lift Tuesday's market, with China Citic Bank up 3.43 percent to 4.52 yuan, and China Minsheng Bank up 3.22 percent to 5.77 yuan.

Shanghai Jinfeng Investment Co., Ltd. and China Sports Industry Group Co., Ltd. both rose by the daily limit of 10 percent to 6.47 yuan and 5.8 yuan, respectively.

Cement makers rose sharply on Tuesday after leading the market decline in past days. Xishui Co., Ltd jumped 9.65 percent to stand at 10.68 yuan.

Stocks related to the concept of "Internet of Things" rallied on the news that the 12th Five-Year Program of the industry may be released next month. Xiamen Xindeco rose 9.98 percent to 10.03 yuan and EVE Energy Co., Ltd was up 7.1 percent to 18.7 yuan.

Gold miners dropped despite a new hike in the price of international gold futures. Shandong Humon Smelting Co., Ltd slumped 3.45 percent to close at 52.6 yuan.