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Money

Stocks post biggest 2010 weekly gain

(China Daily)
Updated: 2010-04-03 09:29

SHANGHAI - China's stocks rose for a second day, driving the benchmark index to its biggest weekly gain this year, as raw-material producers climbed on signs a global recovery boosted the demand for commodities.

Jiangxi Copper Co and Tongling Nonferrous Metals Group Co, China's top two copper producers, advanced at least 2.8 percent. Datong Coal Industry Co rose to a two-month high, leading an advance in coal producers, as rising crude oil boosted the demand for alternative fuel. Kweichow Moutai Co, China's biggest producer of baijiu liquor by value, dropped the most in seven months as profits trailed analysts' estimates.

The Shanghai Composite Index rose 10.54, or 0.3 percent, to 3157.96 at the close, the highest since Jan 21. It has gained 3.2 percent this week, the most in three months, on evidence the economic recovery gained momentum. The CSI 300 Index, which will be the basis for index futures trading, gained 0.5 percent to 3,407.35. China's markets will be shut for a holiday on April 5.

"The environment is still favorable for equities as I don't see any risk of a double-dip, and the economy is in an accelerating growth cycle," said Chen Wenzhao, a strategist at China Merchants Securities Co in Shanghai.

The Shanghai index has erased more than half of its 10 percent loss this year as optimism about the economic recovery overshadows concerns that the central bank will raise interest rates for the first time since December 2007. The gauge is still down 3.7 percent this year, the most among the world's 10 biggest stock markets.

Data on Friday showed the nation's manufacturing expanded in March and the central bank said on March 31 the nation's economic rebound has been "further cemented".

Bloomberg News