Jobs data boosts stocks

Shanghai stocks closed higher yesterday, driven by strong jobs growth. The Shanghai Composite Index edged up 0.41 percent to close at 2,591.69 points.

Computer firms, brokerages and consumer companies were among the biggest gainers.

Urban employment grew 13.61 million in 2018, an increase of 100,000 over the same period a year earlier, the Ministry of Human Resources and Social Security said yesterday. And the registered urban unemployment rate hit its lowest level in several years by the end of 2018 — 3.8 percent compared with 3.83 percent in June last year.

“In 2018, China’s employment conditions made good progress,” ministry spokesman Lu Aihong told reporters in Beijing.

“The steady employment conditions are driven by a number of reasons, including economic development, the industry structure upgrade, an improvement in the business environment and national policies and services to encourage employment.”

Gao Ting, head of China Strategy at UBS Securities, wrote in a research note that the firm has an overall neutral view on the stock market.

Gao suggested investors pay close attention to China-US trade talks, earnings of listed companies in the first quarter of this year and how the market starts after the Spring Festival.

“Entering 2019, the consumer sector has led the market rally due to relatively loose liquidity and supportive government policies,” Gao said.

"However, rice liquor (baijiu) makers and home appliances stocks, which are cyclical, may not outperform the market persistently amid macro and corporate earnings overhangs in the first quarter."

Investor sentiment was also boosted after Gao Feng, spokesman for the Ministry of Commerce, said yesterday China and US will have in-depth discussions on various economic and trade issues during Chinese Vice Premier Liu He’s US visit from January 30 to 31.

Tianfeng Securities Co added 5.21 percent to 7.68 yuan (US$1.13), Yonyou Network Technology Co rose 4.12 percent to 25.54 yuan and Shanxi Xinghuacun Fen Wine Factory Co gained 2.70 percent to 38 yuan.