Markets

Gold, healthcare lead market rebound

By Irene Shen and Zhang Shidong (China Daily)
Updated: 2011-02-24 11:11

SHANGHAI - Stocks on the Chinese mainland rose, with the benchmark index climbing from the biggest loss in a month, as investors sought gold and healthcare companies as a hedge against inflation after violence escalated in Libya.

Zijin Mining Group Co surged the most in four months after bullion traded within 3 percent of a record. A gauge tracking healthcare companies registered the second-biggest gain among 10 industry groups on the CSI 300 Index on speculation that they will be more sheltered from tightening measures and the tensions in the Middle East. China Petroleum & Chemical Corp declined to the lowest in a month as oil traded near the highest level in two years.

"The sentiment in the market is to seek havens as the unrest in the Middle East may drag the indices down in the near term," said Wu Kan, a fund manager at Dazhong Insurance Co, which oversees $285 million. "Some investors may seek valuation opportunities after a big plunge, but the overall downward trend isn't changing."

The Shanghai Composite Index added 0.25 percent to 2862.63 at the 3 pm close on Wednesday, after tumbling 2.62 percent on Tuesday. The CSI 300 increased 0.35 percent to 3174.74.

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The Shanghai gauge has advanced 1.9 percent this year, after plunging 14 percent in 2010, on signs that the economy is withstanding increased monetary tightening.

Zijin Mining surged 8.96 percent to 8.51 yuan ($1.3), the most since Oct 12. Zhongjin Gold Co added 4.81 percent to 38.60 yuan, the highest since Jan 5.

China Petroleum & Chemical lost 2.06 percent to 8.56 yuan, the lowest since Jan 20.

A gauge tracking healthcare companies on the CSI 300 advanced 1.8 percent on Wednesday. Shanghai Fosun Pharmaceutical Group Co rose 0.97 percent to 12.52 yuan. Beijing Tongrentang Co jumped 7.2 percent to 35.14 yuan, its biggest gain since Oct 26.

China Shenhua Energy Co advanced 1.53 percent to 25.27 yuan, the highest since Dec 23.

Hangzhou Songcheng Tourism Development Co, a theme park operator, gained 3.63 percent to 50.48 yuan. Goldman Sachs Group Inc initiated its coverage of the stock with a "buy" rating, citing the company's valuations.

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