By Zhang Shidong
Dec. 5 (Bloomberg) -- China's stock benchmark rose for a fifth day, its longest winning streak this year, on speculation lower energy costs will spur consumer spending and cut corporate overheads as the government adds measures to bolster the economy.
Kweichow Moutai Co., the maker of Moutai, the fiery liquor used at official banquets, rose 2.2 percent. China Vanke Co., the nation's biggest listed property developer, added 5.5 percent. China and the U.S. agreed to cooperate to ease the global credit crisis and pledged an extra $20 billion to fund trade as the two countries ended two days of economic talks.
The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, gained 30.25, or 1.5 percent, to 2,013.18 at the close, for a 10 percent weekly gain. The five-day advance is the longest since the seven days ended Dec. 27. Thirteen stocks rose for every two that fell on the 300-member measure.
``There is lots of accumulated positive news on the economic front, including government policy measures and lower crude prices,'' said Fan Dizhao, an investment manager at Guotai Asset Management Co. in Shanghai, which oversees the equivalent of $5.1 billion. ``That's boosting sentiment.'' He declined to say whether he's buying or selling.
Huaneng Power International Inc., the listed unit of China's largest power group, declined among power producers after a government official said domestic coal-fired power producers may lose more than 70 billion yuan ($10 billion) this year on falling demand.
Moutai, Yanjing
The CSI 300 today closed above 2,000 for the first time since Oct. 8. It has advanced 19 percent over the past month, the best performer among the world's major benchmarks, after the government pledged to implement a 4-trillion yuan economic stimulus package and cut the benchmark lending rate by the most in 11 years. For the year, the gauge has fallen 62 percent on concern shrinking industrial production and slowing exports will stifle economic growth.
China and the U.S. today agreed to provide an additional $20 billion to their import-export banks after two days of talks. China Vice Premier Wang Qishan said he was pushing for further U.S. dialogue. Henry Paulson, U.S. treasury secretary, said yesterday that the talks had helped ease global turmoil.
Moutai rose 2.2 percent to 115.45 yuan. Sichuan Swellfun Co., the Chinese liquor maker that's a partner of Diageo Plc, added 4.6 percent to 12.52 yuan. China Vanke climbed 5.5 percent to 7.55 yuan. Gemdale Corp., a Chinese developer that partnered with ING Groep NV, gained 8.2 percent to 8.23 yuan.
Slumping Oil
Crude oil fell 6.7 percent yesterday in New York to $43.67, the lowest settlement price since January 2005, extending the decline this week to date to 20 percent. Oil has retreated 70 percent from a record $147.27 a barrel on July 11. Prices may slide below $25 a barrel next year if the global recession spills over into China, Francisco Blanch, a London-based analyst at Merrill Lynch, said yesterday.
Air China Ltd., the nation's largest international carrier, advanced 5.4 percent to 4.49 yuan. Hainan Airlines Co., a Chinese carrier backed by U.S. billionaire George Soros, gained 6.4 percent to 3.48 yuan.
Huaneng Power dropped 0.9 percent to 7.40 yuan. Datang International Power Generation Co., a unit of China's second- biggest electricity producer, retreated 1.9 percent to 7.37 yuan. GD Power Development Co., the largest electricity producer in northeastern China, lost 2.1 percent to 6.10 yuan.
Power Demand
Power demand growth in the country may fall by 7 percentage points in 2008 and suppliers will continue to face cost pressure and lower demand next year, the official, who declined to be named because of government rules, said in Beijing today.
PetroChina Co., the nation's biggest oil company, fell 0.3 percent to 11.57 yuan. Offshore Oil Engineering Co., a unit of the country's third-largest oil producer, retreated 2.4 percent to 13.98 yuan.
The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, rose 0.9 percent to 2,018.66. The Shenzhen Composite Index added 2.3 percent to 600.71.
The following companies were among the most active in China's markets. Stock symbols are in brackets after companies' names.
China Satcom Guomai Communications Co. (600640 CH), a unit of the nation's only satellite-communications provider, jumped 0.60 yuan, or the 10 percent daily limit, to 6.60 yuan. China Satcom said China Telecommunications Corp. will take over its parent's stake.
Huadian Power International Corp. (600027 CH), the listed unit of China's fourth-largest power producer, slid 0.12 yuan, or 2.9 percent, to 4.04. Parent China Huadian Corp. said it may invest more than 40 billion yuan in coal mines, power stations and coal-to-chemicals plants in the province of Inner Mongolia.
Ping An Insurance (Group) Co. (601318 CH), China's second- biggest insurer, gained 0.51 yuan, or 2 percent, to 26.26. The stock was rated ``buy'' in the initial coverage by United Securities Co.
Western Mining Co. (601168 CH): China's fourth-largest maker of zinc concentrate rose 0.19 yuan, or 2.8 percent, to 7.03. The company said shareholders approved a plan to spend about 1.3 billion yuan to buy a steelmaker and a stake in an exploration company.
Yanzhou Coal Mining Co. (600188 CH), the listed unit of China's fourth-biggest coal miner, rose 0.19 yuan, or 2 percent, to 9.83. Yanzhou Coal is in talks to buy Australia's Felix Resources Ltd. for more than A$3 billion ($1.9 billion) as the drop in commodity prices prompts industry consolidation, the Australian Financial Review said.
Yunnan Chihong Zinc & Germanium Co. (600497 CH), China's fifth-largest zinc producer, added 0.14 yuan, or 1.4 percent to 10.37. The company said it canceled a plan to sell as much as 10.5 billion yuan worth of shares to Yunnan Copper Group Co. and three other companies after metal prices fell and the stock market tumbled.
To contact the reporter on this story: Zhang Shidong in Shanghai at szhang5@bloomberg.net
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