China's Shanghai stock index gained. China Petroleum & Chemical Corp. (600028) and Yanzhou Coal Mining Co. rose after the government said it would offer tax breaks and loans to the oil and coal industries to boost output.
``Government support will surely reduce costs of leading companies in these industries, and benefit them in the long term,'' said Yan Ji, who helps manage the equivalent of $720 million at First Trust Fund Management Co. in Shanghai. ``This could be an excuse for investors to buy stocks in these industries.''
The Shanghai Composite Index, which covers yuan-denominated A shares and foreign-currency B shares, rose 0.6, or 0.1 percent, to 1136.94. at 11:30 a.m. local time break. The Shenzhen Composite Index, which tracks the smaller of the nation's two stock markets, lost 0.31, or 0.1 percent, to 273.13.
China Minsheng Banking Co. led gains in lenders after the bank received approval to sell subordinated bonds to bolster capital amid growing loan demand.
China Petroleum, Asia's biggest oil refiner also known as Sinopec, gained 0.02 yuan, or 0.4 percent, to 4.53. Sinopec Shanghai Petrochemical Co., China's largest maker of ethylene, rose 0.02 yuan, or 0.5 percent, to 3.86.
The National Development and Reform Commission, the top planning body, said today it will offer tax breaks and loans to industries such as agricultural production, oil and gas exploration, and coal mining.
Yanzhou Coal, China's biggest listed coal miner, rose 0.01, or 0.2 percent, to 5.85. Shanxi Xishan Coal & Electricity Power Co., a miner in western China, advanced 0.03 yuan, or 0.6 percent, to 5.53. Zhengzhou Coal Industry & Electric Power climbed 0.01 yuan, or 0.4 percent, to 2.83.
Minsheng, the nation's first privately owned lender, gained 0.02 yuan, or 0.5 percent, to 4.19. It received approval from the central bank to sell 1.4 billion yuan ($173 million) of subordinated bonds.
Minsheng advanced 0.04 yuan, or 1 percent, to 4.21. The nation's first privately owned lender received approval to sell 1.4 billion yuan ($173 million) of subordinated bonds.
``This is good news for Minsheng as it enables the lender to extend more loans and increase profit,'' said Liang Jing, Shanghai-based analyst at Guotai Junan Securities Co.
Bank stocks also rose after the government said yesterday the Chinese economy is 17 percent larger and growing faster than previous estimates, according to Liang.
``Banks may be allowed to lend more to support economic growth,'' Liang said.
Huaxia Bank Co., one tenth owned by Deutsche Bank AG, jumped 0.06 yuan, or 1.3 percent, to 4.72. Shanghai Pudong Development Bank (600000) Co., the Chinese partner of Citigroup Inc., rose 0.18 yuan, or 1.9 percent, to 9.74.
Separately, Xiamen Overseas Chinese Electronic Co., a Chinese television maker, gained 0.01 yuan, or 0.3 percent, to 3.82 after the company said it will make a profit from a stake sale in a telecommunications venture.
Overseas Chinese will sell a 19.2 percent stake in Lenovo Mobile Telecommunications Co. for 72 million yuan ($8.9 million), or twice as much as the book value, to partner Lenovo Group Ltd., to concentrate on its main business, according to a statement filed to the Shanghai Stock Exchange.
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