China port shares rally, rise 10pc daily limit on free-trade zone talk
Tianjin Port, Wuhu Port Storage, Ningbo Port all rise by daily limit of 10 per cent
The shares of several mainland port operators, including Tianjin Port, rallied by the daily limit yesterday on speculation Beijing would allow more cities to join Shanghai in starting free-trade zones to boost their economies.
Tianjin Port shares jumped 10 per cent in Shanghai trading to hit its highest since August 2011. The stock rose 39 per cent this week. Wuhu Port Storage & Transportation, based in Anhui province, and Ningbo Port also gained 10 per cent. The Shanghai Composite Index added 0.1 per cent.
Shanghai's free-trade zone, which was approved by the State Council last week and may open as early as the end of next month according to Shanghai Securities News, is part of Premier Li Keqiang's drive to shift the economy towards services and sustainable long-term growth.
Tianjin, southeast of Beijing, submitted a plan to the Ministry of Commerce last month, the 21st Century Business Herald reported at the time.
"Tianjin submitted an application to the State Council to set up a free-trade zone similar to the one in Shanghai," said Gerry Alfonso, a trader at Shenyin Wanguo Securities. "It is likely that the authorities will approve that request. Investors are trying to build positions before there is an announcement."
He said the zones were likely to offer tax incentives to entice more companies to set up offices and warehouses, which would increase the volume of goods transported.