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Investors turn to defensive stocks
(China Daily)
Updated: 2010-02-25 10:50
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SHANGHAI: Mainland stocks rose for the first time in three days, led by power producers and healthcare companies, as investors sought industries that would be most shielded against a slowdown in the economy.
The Shanghai Composite Index rose 39.60, or 1.3 percent, to close at 3022.18, the most since Feb 3 and erasing a 0.9 percent loss. The CSI 300 Index gained 1.4 percent to 3244.48.
"The market is turning to defensive stocks with solid earnings prospects," said Dai Ming, a fund manager at Shanghai Kingsun Investment Management & Consulting Co. "The market is likely to be rangebound given the government tightening."
Power producers advanced after Ping An Securities increased its prediction for the country's power output in 2010.
GD Power, the largest electricity producer in the northeast, advanced 5.4 percent to 7.28 yuan, the most since Nov 13. Huadian Power, the listed unit of the fourth-largest power producer, added 2.2 percent to 5.1 yuan. Guangdong Electric Power Development Co gained 1.6 percent to 7.59 yuan.
Yunnan Baiyao Group Co, a manufacturer of traditional Chinese medicines, added 4.1 percent to 60.4 yuan after China began public hospital reform trials.
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An index tracking healthcare companies on the CSI 300 climbed 2.6 percent, a one month-high. The drugmaker gauge is the second-best performer among the 10 industry groups in 2010.
Hang Seng falls
Hong Kong stocks fell, led by exporters and commodity producers, as a drop in US consumer confidence heightened concern that the global economic recovery will slow.
Foxconn International Holdings Ltd, the world's biggest contract maker of mobile phones, declined 3.9 percent. Jiangxi Copper Co dropped 1.1 percent. Shares pared losses briefly after the special administrative region's government announced better-than-estimated economic growth.
The Hang Seng Index lost 0.8 percent to close at 20467.74, halting a two-day gain. The Hang Seng China Enterprises Index retreated 1.1 percent to 11493.41.
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