B shares up amid A-share euphoria
THE A share surge stole the limelight from the Shanghai B-share market where prices rose for the fifth day.
The Credit Lyonnais Shanghai B-share index rose 1.5 per cent to 811.67 on improved turnover of US$10.82 million against $6.83 million on Friday.
The A-share index went through the roof on Saturday's Beijing announcement of a freeze on A-share issues. The Credit Lyonnais A-index soared 637.67 points, or 36.56 per cent, to close at 2,381.68.
Prices in Shanghai and Shenzhen have slumped more than 70 per cent this year, which traders blamed on a glut of new share issues.
The commission announced a series of reforms including a ban on new A-share issues, plans to allow foreign investors limited access to the A-share market, and measures to set up a solid institutional investor base.
''The most significant reform is definitely the ban on new share offerings,'' said Helen Lin, an investment manager with Shanghai's Wangguo Securities.
Gao Xiqing, the securities commission's new-issue department chief, welcomed the market rebound, although he admitted that it was a touch overdone.
However the B-share index didn't quite get caught up in the euphoria.
''The rally ran out of steam in the afternoon,'' said a floor trader for a European Securities firm.
Bloomberg reported that 17 B-share stocks rose, seven fell and four were unchanged.
Steel Tube was the day's most active stock, falling 0.5 per cent to 42.4 US cents with 2.14 million shares traded. The company makes small-calibre, seamless steel tubes.
''It faces strong competition from manufacturers of welded and galvanised tubes,'' said James Capel Asia in its second quarter review of China stocks.
Steel Tube shares rose 7.5 per cent last week amid expectations that the company would post double-digit earnings growth this year.
Phoenix Bicycle, China's largest bicycle maker, rose 3.4 per cent to 61 cents with 1.3 million shares traded.
The company topped all 28 Shanghai B shares in a qualitative survey just completed by Crosby Securities.