Chinese stocks become attractive [Date:08-27-2008] Source: Xinhua
Credit Suisse Group raised its recommendation on Chinese stocks to "overweight" after recent declines and on speculation the nation will introduce a fiscal stimulus package to boost growth.
Credit Suisse previously rated the MSCI China Index "underweight," according to the brokerage's research note released yesterday. The 101-company gauge comprises Hong Kong-listed stocks apart from three traded in Shanghai and three in Shenzhen. The measure has slumped 33 percent this year, valuing it at 13 times estimated earnings, down from this year's high of 28 times on March 5.
Chinese consumer mood rallies [Date:08-27-2008] Source: People’s Daily
China’s consumer confidence rebounded in July as inflationary pressure eased, the National Bureau of Statistics said yesterday.
The Consumer Confidence Index settled at 94.5 last month, up from 94.1 in June and 94.3 in May. The index hit 94 in April, the lowest since at least June last year.
Meanwhile, the index of consumer future hopes also grew to 96.9 in July from 96.5 a month earlier, said a statement on the bureau's Website. It did not elaborate on the number of respondents.
"The government's efforts to tame inflation have paid off in recent months as consumer prices have begun to slow," said Li Maoyu, an analyst with Changjiang Securities Co. "What's more important, people have become less worried about inflation getting worse, which paves the way for the government to fine-tune macroeconomic policies."
The Consumer Price Index, the main gauge of inflation, slowed to 6.3 percent last month from 7.1 percent in June and 7.7 percent in May, due to stable food supply and limited price increases in some daily necessities.
Economists in general agreed the CPI reached a peak of 8.7 percent in February and that was the turning point for the index to head south. With less inflationary pressure, the government now has more room to fine-tune its macroeconomic policies.
China's gross domestic product has eased to 10.1 percent in the second quarter this year from 10.6 percent in the first three months and 11.9 percent last year.