Chinese stocks and their exchange traded funds (ETFs) are getting a boost from PetroChina (PTR), mutual fund sales and interest rate hikes.
PetroChina is looking to boost oil production with foreign partners, reports David Winning of the Wall Street Journal. They are hoping foreign firms can bridge their knowledge gap to enhance recovery. PetroChina’s rally is a big deal because, the Associated Press reports, it’s weighted at 20% in the Shanghai Composite Index. Each 5% rise in its stock lifts the index by 100 points.
Other news from China was that regulators could let mutual funds resume sales soon. Mutual fund sales had been halted in October because of rising share prices.
Yesterday, interest rates were raised to help cool inflation in China’s surging economy, according to Daniel Harrison of TheStreet.com. this marks the sixth hike this year.
- iShares FTSE/Xinhua China 25 Index (FXI), 8.2% in PetroChina; up 55.1% year-to-date;
- PowerShares Golden Dragon Halter USX China (PGJ), 7.3% in PetroChina; up 58.3% year-to-date;
- SPDR S&P China (GXC), 6.4% in PetroChina; up 67.6% since March inception.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.