China''s stock market zooms past the $1-trillion mark

Mumbai: The value of shares traded on China''s Shanghai and Shenzhen stock exchanges more than tripled in the past year taking the volume of trades to $1.01 trillion, reflecting the country''s emergence as an economic powerhouse.

China''s currency, the yuan, also rose past the Hong Kong dollar, reflecting the strength of an economy that has grown 10-fold since Deng Xiaoping opened the economy to overseas investment in 1978.

China''s main stock indexes have continued to rise since July 2005 after plunging by more than half in the previous four years. The recovery came after the government made more than $200 billion of mostly state-owned stock tradable in the biggest ownership shake-up in the market''s 16-year history.

The Shanghai and Shenzhen 300 Index is trading at 34 times earnings, compared with 16 times for Australia''s S&P/ASX 200 Index and 14 times for Hong Kong''s Hang Seng Index. The 300 Index fell 1.1 per cent, paring its 12-month gain to 129 per cent.

China''s economy grew at an average 9.6 per cent in the past five years, driven by record trade surpluses that pushed China''s foreign-exchange reserves to $1 trillion.

China''s economy grew 10.7 per cent in the first nine months of last year after overtaking the UK and France in 2005 to become the world''s fourth largest. The government is scheduled to announce 2006 growth figures on January 25.