国内英语新闻:Chinese shares vault to new high

BEIJING, June 21 -- Chinese stocks rose to a weekly high on Friday after the securities regulator lifted a nine-month ban on initial public offerings (IPOs), indicating investors' strengthened confidence in the market based on ample liquidity and clearer signs of economic recovery.

    The Shanghai Composite Index, which tracks the bigger of China's bourses, rose 26.59, or 0.9 percent, to 2,880.49 at close, its highest close since July 28, 2008.

    The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, gained 0.7 percent to 3,080.

Investors are set to return to the bourses in a big way with the return of initial public offerings and robust economic indicators. The market barometer has also shown significant gains in the past few days. Shi Yan

    "We expected the new IPOs to be the biggest bad news for the capital market this year," said James Yuan, chief investment officer of Everbright Pramerica Fund Management Co Ltd. "But now it is not as daunting, thanks to the improved economy, more liquidity and new listing rules."

    Guilin Sanjin Pharmaceutical Co, a medium-sized drug firm, on Thursday night received regulatory approval from the China Securities Regulatory Commission (CSRC) to seek a stock exchange listing, marking the resumption of IPOs since September last year.

    The company said it plans to float 46 million A shares on the Shenzhen bourse on June 29 and will start a road show for the same on June 22.

    "The restarting of IPOs of smaller firms rather than the big caps indicates that the government aims to stabilize the market," said Dong Chen, senior analyst, CITIC China Securities. "If the market does not panic after the new round of IPOs, the regulator will grant more approvals next week, but probably for small caps."

    Earlier reports said China State Construction Engineering Corp (CSCEC), the country's biggest home-builder, would probably be among the first batch of companies to issue 12 billion shares to the public and raise about 40 billion yuan.

    Based on the number of new shares to be issued and the average price-earning ratio on the secondary market, analysts said the 32 companies now waiting could raise as much as 70 billion yuan through their IPOs.

    "The loose monetary policy, coupled with the huge advance of the Shanghai Composite Index, has bolstered confidence that the stock market can withstand the added supply of stock," said Dong.

    "Meanwhile, the anticipation of gains on their investments may propel more investors to test the market waters, when the bullish trend becomes clear," he said.

    China's major market barometer has surged nearly 58 percent this year, thanks to the government's timely launch of the 4-trillion-yuan economic stimulus package and loose monetary policy.

    The resumption of IPOs is also expected to give a strong boost to brokerages whose earnings are expected to improve on the investment banking revenues.

    CITIC Securities gained 2.8 percent to 29.54 yuan, the highest in a year, while Sinolink jumped 10 percent to 21.46 yuan.

    Shares of medical companies also outperformed on news of drugmaker Guilin Sanjin's listing and the spread of the H1N1 flu virus.

    Beijing Tiantan Biological Products, a biological bacterin producer, jumped to its 10 percent daily limit for the second day in a row to 26.26 yuan after it said on Thursday that it had started to research bacterin for fighting the H1N1 flu virus.