BUSINESS Chinese shares close higher despite epidemic

BUSINESS

Chinese shares close higher despite epidemic

Xinhua

19:37, February 07, 2020

BEIJING, Feb. 7 (Xinhua) -- China's major stock indices closed higher for the 4th straight day Friday despite the novel coronavirus outbreak as government measures boosted investor confidence.

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File Photo

The benchmark Shanghai Composite Index gained 0.33 percent to 2,875.96 points and the Shenzhen Component Index closed 0.10 percent higher at 10,611.55 points on Friday.

The combined turnover of stocks covered by the two indices stood at 929.59 billion yuan (about 133.24 billion U.S. dollars), expanding from 913.5 billion yuan the previous trading day.

Gainers outweighed losers by 804 to 625 on the Shanghai bourse and 1,407 to 708 in Shenzhen.

The ChiNext Index, China's NASDAQ-style board of growth enterprises, inched up 0.18 percent to close at 2,015.80 points Friday, hitting a new record for over three years.

Shares in medical waste treatment, cloud office and computing sectors led the gains, with the shares of Dr.peng Telecom & Media Group Co., Ltd., a broadband service provider, surging by the daily limit of 10 percent.

The rebound indicated that investors confidence were picking up, said Yang Delong, chief economist of First Seafront Fund.

The recovery came after a bumpy start Monday when the benchmark Shanghai Composite Index dropped 7.72 percent as investors reacted to the ongoing novel coronavirus outbreak after a long holiday break.

The country has plenty of policy tools to cushion the short-term impact of the outbreak on the economy, Pan Gongsheng, vice head of the People's Bank of China, told a press conference Friday.

The epidemic might disturb economic activities in the first quarter of this year, but the impact is temporary, he added.

To stabilize market expectations and boost market confidence, the central bank released 1.7 trillion yuan of liquidity via reverse repos on Monday and Tuesday.

Uncertainties still remain as listed companies are expected to release their first quarter reports, which might not look good due to impact of the outbreak, said Dong Dengxin, director of the Institute of Finance and Securities at Wuhan University of Science and Technology.

He expected fluctuations in the stock market in February and an upward trend for the whole year.

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