Stock markets in Shanghai and Shenzhen ended at odds Tuesday after a wave of positive news buoyed several of the market's heavily weighted sectors.
The benchmark Shanghai Composite Index added 0.85 percent, or 17.45 points, to close at 2,073.15, its highest close in three weeks. Meanwhile, the Shenzhen Component Index gave up a scant 1.79 points, or 0.02 percent, to finish at 8,400.36 after tumbling late in the trading day.
Both indices opened lower and wavered throughout the morning session despite strong gains in the steel sector after Baoshan Iron & Steel Co, one of the country's largest steel makers, announced a share buyback plan.
Speculations emerged in the afternoon that leading firms in other sectors would soon follow Baosteel's example with repurchase plans of their own, leading shares of State-owned giants like China Petroleum & Chemical Corporation (Sinopec), PetroChina Co, China United Network Communications Ltd, China Shenhua Energy Co to soar on a sudden surge of investor confidence.
More than 70 percent of A shares increased Tuesday, with the steel, oil and brokerage sectors numbering among the day's best performers.
Brokerages got a huge hoist mainly from the release of long-awaited refinancing rules that will allow securities companies to borrow cash and equities from China Securities Finance Corporation to expand their margin trading and short selling businesses. Sinolink Securities Co added 6.32 percent to end at 10.77 yuan ($1.69), while Guoyuan Securities shot up 4.7 percent to 10.48 yuan.
Despite the day's broad victory, cautious trading sentiment continued to overshadow the A share market, according to analysts. The combined turnover of the Shanghai Composite and Shenzhen Component shrank 10.08 percent compared to Monday to 92.33 billion yuan.
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