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Chinese shares rebound 0.3 pct despite fears of liquidity crunch |
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18:32, July 11, 2007 |
Chinese shares closed 0.33 percent higher on Wednesday despite the launch of initial public offerings (IPO) of four domestic companies renewing fears of a liquidity crisis.
The benchmark Shanghai Composite Index, which covers A and B shares listed on the Shanghai Stock Exchange, climbed 12.7 points, or 0.33 percent, to close at 3,865.72 points.
The component index of the smaller Shenzhen Stock Exchange was up 103.63 points or 0.82 percent, to 12,785.67 points.
The combined turnover of the two bourses, however, fell to 99 billion yuan (13 billion U.S. dollars), the lowest level since the market entered its adjustment period at the end of May. The combined turnover was 159.7 billion yuan on Monday and 109.1 billion yuan on Tuesday.
Analysts say the continuous fall in turnover is mainly due to fears of a liquidity crunch and possible tightening of polices to rein in economic growth, as well as the absence of favorable news.
On Thursday, four companies will launch their IPOs, including the Bank of Nanjing, the Bank of Ningbo, the Sichuan Gaojin Food Co. Ltd. and Guangdong Ronsen Super Micro-wire Co. Ltd., which are expected to draw a total of 1.2 billion yuan.
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