SHANGHAI, China, Jan. 19 /Xinhua-PRNewswire/ -- Xinhua Finance and Milken Institute today released updated values for their Chinese Initial Public Offering (IPO) Indicator and Renminbi Pressure Indicator (RPI). The IPO Indicator rose nearly 20% in December, mainly due to the continued strong performance of Industrial and Commercial Bank of China (ICBC/Code: A Share, 601398; H Share, 1398). The RPI continued its upward trend, increasing 0.86 percent in October, a slight acceleration from its 0.75 percent rise over the previous month.
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The updated indicator charts can be found at http://www.xinhuafinance.com/en/charts/ipo_rpi/0701.html
and http://www.milkeninstitute.org/chinaindicators .
The IPO Indicator tracks the share price performance of new issues of mainland Chinese firms listed on the Shanghai, Shenzhen and Hong Kong stock exchanges. The RPI indicates upward or downward pressure on the RMB as compared to the U.S. dollar exchange rate, as determined by changes in three primary factors: the percentage change in the nominal exchange rate and the change in domestic interest rates, as well as the percentage change in China's foreign exchange reserves. The two indicators are part of a series of eight indicators designed to increase transparency within China's emerging financial markets.
The IPO Indicator for December was 237.8, a 19.6% increase from November. ICBC shares accounted for 76% of the overall increase. Of the 81 issuances comprising the indicator, 47 rose, while 34 dropped during the month. Of the 20 new IPOs that generated US$4 billion in proceeds, China Coal (H Share, 1898) led the pack, raising US$1.7 billion.
In China's currency market, the RPI continued its upward trajectory in October. While both RMB appreciation and accumulating foreign exchange reserves drove the indicator higher, the rate of appreciation lagged behind the previous month, slowing to 0.37 percent from 0.63 percent in September. Foreign exchange reserves exceeded US$1.01 trillion, a 2.19 percent monthly increase, against a 1.63 percent increase in September. Interest rates did not change.
Glenn Yago, Director of Capital Studies at the Milken Institute, said, "Looking ahead to next month, China Life's listing will have an impact, mitigating some of the dominant role ICBC is playing in the IPO indicator." China Life (A Share, 601628) was listed on the Shanghai Stock Exchange on January 9, 2007, marking the first listing of an insurer in Mainland China. China Life shares more than doubled in their first day of trading.
He added, "Meanwhile, the RPI continues along its linear ascent, showing no sign of reversal, indicating a further strengthening in appreciation pressures."
Both the IPO Indicator and RPI are calculated monthly and released mid-month. The next releases of the IPO and Renminbi Pressure indicators will be in mid-February 2007.
The Xinhua Finance/Milken Institute China Indicators are designed to increase transparency and data quality in China's burgeoning financial markets. The series applies the world-class index calculation methodologies of Milken Institute, one of the world's leading economic and financial research think tanks, and the extensive data resources of Xinhua Finance, China's premier financial information and media service provider. The indicators are used by asset managers, underwriters, economists, and product developers in assessing China's market environment in support of investment decision-making.
To view additional information, visit http://www.xinhuafinance.com/indicators and http://www.milkeninstitute.org/chinaindicators .
About Xinhua Finance Limited
Xinhua Finance Limited is China's unchallenged leader in financial information and media, and is listed on the Mothers board of the Tokyo Stock Exchange (symbol: 9399) (OTC ADRs: XHFNY). Bridging China's financial markets and the world, Xinhua Finance serves financial institutions, corporations and re-distributors through four focused and complementary service lines: Indices, Ratings, Financial News and Investor Relations. Founded in November 1999, the Company is headquartered in Shanghai with 20 news bureaus and offices in 19 locations across Asia, Australia, North America and Europe. For more information, please visit http://www.xinhuafinance.com .
About the Milken Institute
The Milken Institute is a nonprofit, independent economic think tank whose mission is to improve the lives and economic conditions of diverse populations around the world by helping business and public policy leaders identify and implement innovative ideas for creating broad-based prosperity. The Milken Institute has extensive expertise in China and conducts ongoing research on China's banking and capital markets. It is based in Santa Monica, CA. For more information, please visit http://www.milkeninstitute.org .
Contact information:
Xinhua Finance
China
Ms. Joy Tsang
Tel: +86-21-6113-5999, +852-948-64363
Email: joy.tsang@xinhuafinance.com
Japan
Mr. Jiong Sun
Tel: +81-3-3221-9500
Email: jsun@xinhuafinance.com
Taylor Rafferty (Media contact for Xinhua Finance)
Japan
Mr. James Hawrylak
Tel: +81-3-5733-2621
Email: James.hawrylak@taylor-rafferty.com
United States
Ms. Ishviene Arora
Tel: +1-212-889-4350
Email: ishviene.arora@taylor-rafferty.com
Europe
Mr. John Dudzinsky
Tel: +44-20-7614-2900
Email: John.Dudzinsky@taylor-rafferty.co.uk
Milken Institute
Ms. Jennifer Manfrè
Associate Director of Communications
Tel: +1-310-570-4623
Email: jmanfre@milkeninstitute.org
