Rebound sends index above 3,000 points at midday

By Lydia Chen  |   2008-6-20  |     ONLINE EDITION

A STRONG rally among power producers and oil-related shares pushed Shanghai's key stock index back above the 3,000 point mark in the morning session today after the government raised fuel prices and said it will increase power fees.

The Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B shares, jumped 4.75 percent, or 137.10 points, to 3,020.99 at 11:30am. The surge comes one day after the market sank 6.54 percent.

Gainers in the Shanghai market outnumbered losers 736 to 53 while four were unchanged.

The Shenzhen Composite Index, which tracks the smaller domestic stock exchange, was up 4.19 percent, or 32.67 points, to 813.23.

China Petroleum & Chemical Corp and PetroChina Ltd, the nation's two largest oil refiners, gained after the price of gasoline and diesel was increased by at least 17 percent.

Huaneng Power International Inc, the listed unit of China's largest power group, led utilities higher.

Haitong Securities Co paced gains by brokerages after the nation's financial regulator imposed a lockup on some shareholders.

China Petroleum & Chemical Corp, known as Sinopec, jumped 4.53 percent to 13.14 yuan (US$1.91) while PetroChina, the biggest oil producer and largest stock by market capitalization, increased 5.14 percent to 15.95 yuan.

Gasoline prices will increase 17 percent to 6,980 yuan a metric ton today, diesel will rise 18 percent and jet fuel will climb 25 percent, the National Development and Reform Commission said on its Website late yesterday.

Besides, the government will increase electricity prices by an average 0.025 yuan a kilowatt-hour, or 4.7 percent, on July 1 and cap prices of coal burned in power stations until the end of this year, the commission said.

Huaneng Power gained as much as 10 percent, the daily limit, to 8.79 yuan. Huadian Power International Corp, a unit of the country's fourth-biggest electricity producer, also surged 10 percent to 5.15 yuan.