Wednesday, February 24, 2010 12:22:52 AM
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By Bloomberg News
Feb. 24 (Bloomberg) -- China’s stocks rose for the first time in three days, led by power producers and health-care companies, as investors sought industries that would be most shielded against a slowdown in the economy.
GD Power Development Co. and Huadian Power International Corp. advanced at least 1.6 percent after Ping An Securities Co. increased its prediction for the country’s power output in 2010. Yunnan Baiyao Group Co., a manufacturer of traditional Chinese medicines, added 3.6 percent. China Railway Erju Co. climbed 8.7 percent after winning construction contracts.
The Shanghai Composite Index rose 17.43, or 0.6 percent, to 3,000 at the 11:30 a.m. break, reversing a 0.9 percent loss. The gauge has slumped 8.5 percent this year on concern the government will raise interest rates and curb lending to cool the economy and avert asset bubbles. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, gained 0.8 percent to 3,223.22.
“The market is turning to defensive stocks with solid earnings prospects,” said Dai Ming, a fund manager at Shanghai Kingsun Investment Management & Consulting Co. “The market is likely to be rangebound given the government tightening.”
A decline in U.S. consumer confidence to a 10-month low raised concern that the global economic rebound may falter. In addition, the Ifo institute in Munich said its survey of German business confidence unexpectedly fell for the first time in 11 months in February as the coldest winter in 14 years damped retail sales and construction.
Power Producers
GD Power, the largest electricity producer in northeastern China, advanced 5.5 percent to 7.29 yuan, set for the biggest gain since Nov. 13. Huadian Power, the listed unit of China’s fourth-largest power producer, added 1.6 percent to 5.07 yuan. Guangdong Electric Power Development Co., the biggest operator of power plant in the southern Chinese province bordering Hong Kong, gained 1.6 percent to 7.59 yuan.
China’s power output is expected to rise 15 percent in 2010 from last year, Ping An Securities said in a report today, higher than an earlier prediction of 9 percent growth.
Power consumption jumped 40.1 percent from a year earlier in January, the National Energy Administration said on Feb. 12.
Yunnan Baiyao added 3.6 percent to 60.11 yuan. Yabao Pharmaceutical Group Co. rose 4.3 percent to 19.97 yuan. An index tracking health-care companies on the CSI 300 climbed 2.2 percent, set for its highest close in a month. The drugmaker gauge is the second-best performer among the 10 industry groups this year.
http://www.bloomberg.com/apps/news?pid=20601089&sid=a.pKKQWZ0Wcc
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