Index overcomes monetary tightening; hits one-month high
By Ding qi (chinadaily.com.cn)
Updated: 2007-07-23 16:41
Updated: 2007-07-23 16:41
The central bank announced last Friday the year's third interest rate hike, which was accompanied by the State Council's decision to reduce the interest income tax from August 15. However, the moves had been widely anticipated among investors and fully absorbed via previous market correction. The confirmation from the government, therefore, has cleared the market of uncertainties and was received as positive news.
The recovery of the market is also a good sign for both brokers and the government. The Shanghai Securities News reported on Monday that total profits of the country's top 50 securities dealers surged by 411 percent year-on-year to 41.77 billion yuan in the past six months. Meanwhile, the nation's stamp tax income of stock trading went through a 13 fold increase to 3.18 billion yuan in June from a year earlier, mainly created by the hike of the stamp tax in May 30, according to sources from the tax regulators.Analysts believed the rosy corporate profit prospects and abundant liquidity from the newly issued mutual funds would boost the market to a new high, but volatility was still unavoidable. Moreover, if the latest measures fail to cool the economy, investors' anticipation of further tightening may loom again.
|
|