|An investor smiles at a stock brokerage yesterday in Shanghai. Asian stock markets bounded higher yesterday after investors got just what they wanted - big moves by the US Federal Reserve to help the American economy out of its funk.(Shanghai Daily)|
Shanghai stocks advanced the most in one week yesterday, boosted by commodity-related stocks, after the US Federal Reserve unveiled its anticipated bond buying program, or quantitative easing, to help stimulate the weak US economy.
The Shanghai Composite Index rose 0.64 percent to 2,123.85 points, paring a decline this week to 0.21 percent.
The Fed on Thursday said it would buy mortgage securities at a rate of US$40 billion a month in a bid to invigorate the US real estate market and lower the jobless rate. The package known as the third round of quantitative easing, or QE3, will continue until the US economy recovers, according to the Fed.
Li Xunlei, chief economist at Haitong Securities Co, said the extra Fed easing will draw hot money back to China from the US market. "This will push up China's property prices and exert a simulative impact on the stock market," he said.
Some analysts also expect the Fed's move to provide a tonic to China's exports.
Gold stocks rose following a surge in their prices on hopes the Fed move will boost consumer demand.
Zijin Mining Group Co, the country's largest gold producer, rose 3.3 percent to end at 4.03 yuan, Shandong Gold Mining Co gained 5.3 percent to 39.68 yuan and Zhongjin Gold Corp jumped 6.7 percent to finish at 16.39 yuan.
Inner Mongolia Baotou Steel Rare-earth (Group) Hi-tech Co, China's biggest producer of rare earth materials, added 2.2 percent to 35.49 yuan. Jiangxi Copper, China's biggest producer of the metal, rose 3 percent to close at 23.13 yuan.
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