China Economic Scan - Your daily update on the Chinese economy.
In this edition: World bank raises China growth forecast to 7.2%, China sees 120% increase in rail investment, China set to grant final approval for first IPO since September, CIC goes on global hiring spree, Chinese stocks rise to 11 month high.
Top 5 headlines
World Bank Raises China 2009 Growth Forecast to 7.2%
- The World Bank raised its growth forecast for China this year and advised policy makers to delay until 2010 any additional stimulus plan to boost the world’s third-largest economy.
- China’s economy will expand 7.2% in 2009 from a year earlier, up from a 6.5 percent forecast in March, the Washington-based lender said in a quarterly report released today in Beijing. Stocks gained after the announcement.
- The World Bank joins Goldman Sachs Group Inc., Morgan Stanley and UBS AG. in raising growth forecasts this year after a 4 trillion yuan ($585 billion) stimulus package triggered record loans and surging investment.
China sees 120% rise in rail investment in first five months
- China saw a surge of investment in railway construction as the country pledged to increase spending as an effort to buoy the world's third largest economy.
- In the first five months, China pumped 168.9 billion yuan ($24.7 billion) in fixed-asset investment in railways, up 120% from a year earlier, the Ministry of Railways said in a statement Wednesday.
- The money included 149 billion yuan for railway infrastructure construction, up 161.8% from a year ago, 3.328 billion yuan for railway upgrading, and 16.55 billion yuan for purchasing trains, according to the ministry.
China Set to Grant Final Approval for First IPO Since September
- China’s securities regulator will grant final approval by tomorrow for the nation’s first initial public offering since September, two people familiar with the situation said.
- Guilin Sanjin Pharmaceutical, Zhejiang Wanma Cable and Shenzhen Salubris Pharmaceuticals are the three candidates for getting written permission to sell stock in Shenzhen, supposedly.
- “The securities regulator is still concerned about the benchmark’s performance,” said Sun Jian, a Shanghai-based analyst at Shenyin Wanguo Securities Co. “The market has been rising this week, which is an indication of sufficient liquidity and confidence.”
CIC goes on global hiring spree
- China Investment Corp (CIC), the country's $200 billion sovereign wealth fund, said it would start a new round of global hiring to support an expansion of its operations as it seeks new overseas investments.
- CIC, which currently employs about 200 people, will seek professional staff in 33 categories, including risk management, real estate, infrastructure, commodities and hedge fund investment, according to its website.
- "We are a new company, so it's natural for us to hire more people to grow," a CIC spokeswoman said. She declined to indicate the exact number of people CIC plans to hire.
China’s Stocks Rise to 11-Month High; ICBC, Shenhua Advance
- China’s stocks rose, driving the benchmark index to an 11-month high, after the World Bank raised its growth forecast for the country this year and Shenyin & Wanguo Securities Co. recommended buying machinery makers.
- Industrial & Commercial Bank of China Ltd., the nation’s biggest listed lender, rose +2.6% and China Shenhua Energy Co., the No. 1 coal producer, gained +5.5%.
- The country’s economy will expand 7.2% this year, up from a 6.5% forecast in March, the bank said. Sany Heavy Industry Co. climbed +4.9% after Shenyin & Wanguo said the company will benefit as property investment rebounds.
Financial Indicators:
| Metric | Value | Point change | % change |
| Hang Seng Index | 17,777 | -307.94 | -1.70% |
| Shanghai Composite | 2,854 | 43.78 | 1.56% |
| Shenzhen Component | 11,152 | 111.14 | 1.01% |
| TAIEX | 6,145 | -51.38 | -0.83% |
| CNY/USD | 6.8355 | -0.0027 | -0.04% |
Source: China Economic Scan
