Shanghai Market Up on Steelmakers, Miners

The Shanghai Composite Index jumped 1.54% to close at 2,696.25, while the Shenzhen Composite Index climbed 0.01% to end at 1,178.35 on Monday, September 6. Trading volumes on the Shanghai and Shenzhen Stock Exchanges were 14.42 billion and 9.32 billion, respectively.

Lingyuan Iron & Steel （600231.SH） soared 9.99% and Liuzhou Iron & Steel （601003.SH） jumped 8.38%, while sector giants Baoshan Iron & Steel （600019.SH） and Angang Steel （0347.HK, 000898.SZ） gained 7.06% and 6.27%. Hebei Province has been rationing power to steel companies from September 3, forcing 40 steel mills to close factories for the next month, Mysteel reports. The same day, the State Council announced that it will encourage more mergers and acquisitions within a number of sectors including steel, aluminum and rare-earths. Aluminum giants Chalco （NYSE:ACH, 2600.HK, 601600.SH）, Shandong Nanshan Aluminum （600219.SH） and Jiaozuo Wanfang Aluminum （000612.SZ） gained 1.99%, 3.17% and 3.81%, respectively. Lithium and other rare-earth miners slumped with BGRIMM Magnetic Materials （600980.SH） dropping 9.99%, Gan Feng Lithium （002460.SZ） losing 7.88%, Tibet Mineral Development （000762.SZ） falling 6.48%and Shenzhen Desay Battery Technology （000049.SZ） down 6.41%.

Coal miners and power producers gained, with Chongqing Three Gorges Water Conservancy and Electric Power （600116.SH） improving 9.74% while thermal energy producers Guangzhou Hengyun Enterprises （000531.SZ） and Inner Mongolia Mengdian Huaneng Thermal Power （600863.SH） rose 4.49% and 4.47%. Shanxi Coal International Energy Group （600546.SH）, Guizhou Panjiang Refined Coal （600395.SH） Jizhong Energy Resources （000937.SZ） increased 7.67%, 4.62% and 4.35%, respectively.

Sinolink Securities （600109.SH） rose 10.03%, GF Securities （000776.SZ） increased 10% Northeast Securities （000686.SZ） added 6.5% and Guoyuan Securities （000728.SZ） climbed 6.17%.

Sinochem （600500.SH） and China's sovereign wealth fund China Investment Corporation may make a bid for Canadian company Potash Corp （TSX:POT）, Reuters reports. Sinochem stock edged up 0.73% on Monday, while domestic potash producers Qinghai Salt Lake Industry（000578.SZ） and Qinghai Salt Lake Potash （000792.SZ） gained 3.72% and 2.91%.

The ChiNext board slumped 2.5% on Monday to 1,010.76. People's University of China Finance and Securities Research Institute Director Wu Shaoqiu described the start-up board as an "enormous source of risk" in China today.