Chinese main stock index rose 1 percent on Thursday in its ninth straight day of gains, though steel plays gave back Wednesday's jump and analysts said the market was increasingly vulnerable to any negative news. The Shanghai Composite Index closed up 1.02 percent at 3,531.029 points, just off an all-time high of 3,532.862 hit earlier in the day.
Turnover in Shanghai A shares was a very heavy 147.8 billion yuan ($19.1 billion), though down from Wednesday's record 155.6 billion yuan. Gainers outweighed losers by 724 to 126.
"The market is still in a general uptrend, that's all there is to say about it," said Xu Yinghui, analyst at Guotai Junan Securities, though he added there were also sector-specific factors such as raw material prices moving metals stocks. The index is now up 23 percent from the end of February and has reached the 3,500 point level, which many investors had seen as a target.
Few analysts feel confident calling a top to the rally, as money continues to pour into the market from newly established mutual funds, and several firms have delivered strong first-quarter earnings estimates in recent days.
But some analysts think that given the speed of the rally, the market has become vulnerable to any bad news - for example, any sign that the government, which has looked on benignly in recent weeks, feels the market is overheating.
"For the market as a whole, it would not take much to trigger an overall correction, since investors are getting nervous after such a long upward run," said Yang Weidong, analyst at MF Securities.
Nanjing Panda Electronics jumped its daily 10 percent limit to a 38-month high of 10.15 yuan after announcing a change of the main shareholder in its parent company.
Ownership of the parent has shifted in a deal involving state-owned China Electronics Corp and municipal and state asset supervision commissions, making CEC the parent's big shareholder.
Panda's statement did not give details of how the change would affect its business or long-term development. But Xu said investors generally had a good impression of the new shareholder. In the market's current fevered mood, that was enough to send the stock soaring.
Copper plays again helped pull shares higher as Shanghai copper futures rose their 4 percent limit on Thursday, as traders anticipated London futures breaking above $8,000 a tonne. Jiangxi Copper rose 2.87 percent to 25.05 yuan.
But steel stocks lost steam. Baoshan Iron and Steel, which had jumped almost 6 percent since estimating on Tuesday that first-quarter net rose at least 150 percent, fell 0.63 percent to 11.08 yuan, pulling down the sector.
Banks and insurers, sought by institutions as important components in the futures index which is expected to be launched in the first half of this year, were mixed.
Some stocks moved little despite announcing spectacular 2006 or first-quarter earnings, because they had previously issued statements preparing investors for the news. Fuyao Group Glass Industries Co rose just 0.87 percent to 20.87 yuan after posting a 66 percent rise in first-quarter net profit.
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