Technology Stocks Rise Most in China's Benchmark Index on Stimulus Boost
China National Software & Service Co. and Hualan Biological Engineering Inc. led a rally for technology and health-care stocks on government plans to increase investment in these industries to boost domestic demand.
China National Software jumped by the 10 percent daily limit to 19.43 yuan at the close while Hualan Biological gained 3.1 percent to a record 49.20 yuan. An index tracking info-tech stocks was the biggest gainer among the 10 industry groups on the CSI 300 Index, which dropped 0.8 percent to 2,736.08.
China will promote the development of the software industry, the head of the industry and technology ministry said in a speech published today, while the China Securities Journal said today a plan to stimulate bio-technology in the country may be submitted to the cabinet for approval this month.
“The government is determined to boost the domestic economy through developing emerging industries such as software,” said Dai Ming, a fund manager at Shanghai Kingsun Investment Management & Consulting Co.
The government wants to shift reliance on export-led economic growth by increasing domestic demand. China faces a “pressing” task in the “post-crisis era” to adjust its growth model and move away from reliance on investment and exports, which may be restrained by a slow world recovery, Vice Premier Li Keqiang wrote in the Chinese Communist Party magazine published June 1.
The government will seek to promote electronic commerce, education, networking services and other software applications, Li Yizhong, the head of the Ministry of Industry and Information Technology said in a speech posted on the ministry’s website.
Ufida Software Co. gained 6.4 percent to 21.29 yuan. Inner Mongolia Jinyu Group Co., a manufacturer of biopharmaceuticals for animals, rose 0.1 percent to 10.55 yuan.
China’s top economic planning agency may submit a draft plan for developing the country’s bio-technology industry this month to the State Council, the China Securities Journal reported today, citing Jiang Zehui, vice chairman of the National Committee of Population, Resources and Environment.
China’s pharmaceuticals market including nutritional products and consumer drugs, will more than double to $110 billion by 2015 from $44 billion in 2008, Credit Suisse AG estimated in a November 2009 report.