China’s Roads-to-Subways Construction Spurs Stocks Rally
By Jasmine Wang - Sep 7, 2012
HONG KONG (Bloomberg)--China approved plans to build 2,018 km (1,254 miles) of roads, spurring the biggest stock-mkt rally in almost 8 mos. on signs the gov’t is stepping up stimulus efforts to revive eco. growth.
The gov’t also backed nine sewage-treatment plants, 5 port & warehouse projects, & 2 waterway upgrades, accdg to statements on the website of the Nat’l Dev’t & Reform Commission yesterday. No investment amts were given.
The announcements came a day after approvals for subway projects in 18 cities, an earlier rise in the railway-bldg budget & increases in land supplies in cities incl. Guangzhou, Hangzhou, Beijing & Shanghai.
“They are clearly stepping up the infrastructure- investment push to help boost confidence and revive growth,” said Zhang Zhiwei, HK-based chief China economist at Nomura Hldgs Inc. Premier Wen Jiabao’s policy stance is shifting “to a more proactive & significant easing.”
The gov’t may boost infrastructure-spending growth to an annual pace of more than 20% in the coming mos. from 15% to stimulate the eco., HSBC Hldgs Plc economists Qu Hongbin & Sun Junwei said in a note yesterday