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China stock market report by ChinaStockAdvice.com (May 8, 2009)

The market opened slightly high yesterday. Shanghai Composite Index opened above 2,600 points, and the big-cap tended to organize the main concussion all day. Barometer stocks maintained steady, while the individual shares mostly dropped. Turnover of the two markets slightly increased than that of the previous trading day. Meanwhile, international oil price continued surging, which drove the further raise in coal sector. Segments of banking, tourism & hotel and non-ferrous metal performed actively as well; contrarily, industries of pharmaceutical, electric equipment, education and media topped the plunge.

Recently, the market is positive in terms of policy, and turnover keeps flourishing; outburst is obvious as the big-cap is bouncing back. Optimistic performance of external markets creates a prominent developing environment for the A-share market; hot issuance of CS Funds indicates that the market capital is abundant. We predict the after-market will maintain the strong trend.

Macro-economic Policy

State Council Drafted Files to Support and Promote Development of Traditional Chinese Medicine Industry

National Development and Reform Commission: Domestic Oil Price Adjustment Needs Further Observation, Results to Be Released Soon

Domestic Market

Mr. Shang Fulin: CSRC to Well Implement Law-based Administration through Five Aspects

Hang Seng index closed high by 383.32 points or 2.28% at 17217.89 points.

Financial sub-index greatly outperformed Hang Seng index.

Public utilities board declined most among Hang Seng composite industries.

Overseas Market

The European Central Bank Announced to Cut Benchmark Interest Rate by 25BP to 1%

Mr. Jean-Claude Trichet Announced the European Central Bank to Purchase USD80.5bn Bonds

Overview: American Stocks Closed Low; High-tech Shares Got Heavily Frustrated

President Obama Declared Governmental Budget Details and Planned to Axe USD17bn Expenses

S&P 500 closed low by 12.14 points or 1.32% at 907.39 points.

American unemployment acceleration showed initial slowdown.

Nintendo of Japan saw net profit increment of 8.5% in FY 2008.

Companies & Industries
 
- 6 Months Passed, Integration Solution of Yunnan Yuntianhua (600096) to Be Adjusted

- 105th Canton Fair Closed; Turnover of Textile & Garment Industry Reduced by 11.7%

Macro-finance & Real Estate Industry
- Export Business Volume Decline of China Import & Export Fair Narrowed Compared with That of Last Time

- China Construction Bank Corporation (601939): Holdings Likely to Be Reduced by Bank of America, Posing No Big Pressure on Share Price

IT Industry
- State Administration of Radio, Film and Television Cooperated with China Mobile to Roll out CMMB+TD Mobile Phone

- Taiwan Kinposh Upgraded Estimation of Laptop Shipment in Q2 2009

- BOE Technology Group (000725): Non-public Issuance Approved; Construction of 6th Generation Liquid Crystal Screen Production Line to Be Progressed Smoothly

- Shenzhen Seg (000058): Transferred 100% Equity of Its Subsidiary Seg Communication; EPS Added by Rmb0.04

Consumer Goods Industry
- Chongqing Holley Pharm (000607): Won Patent Lawsuit, Effect of Artemisinine Capital Integration Expected to Emerge Acceleratively

- Nanzhi Co., Ltd., Fujian (600163): The Third Largest Shareholder Reduced 5% Equity; 231mn Restricted Shares to Be Released on May 25, 2009

- Shanghai Metersbonwe Fashion & Accessories (002269): Market Network Project Further Boosted
- State Council Released Opinions to Promote Development of Traditional Chinese Medicine Industry

- Food Industry: Dairy Association of China Rectified Definition of Antibiotic-free Milk and Suggested Related National Standard Coming out Soon