Chinese Telecom Stocks Spike on 3G Implementation News

China Business News, 12/28/07

Although the State Council has only passed a program for implementation of next-generation wireless mobile communications networks, many in the investment sector are interpreting this as approval for 3G implementation, leading to a jump in share prices for 3G firms.

Datang Telecom (600198.SH) shares rose 4.99%, to RMB 18.94, before hitting their limit up. ZTE (0763.HK; 000063.SZ) rose 7.4%, to RMB 63.69; while China Unicom (NYSE: CHU; 0762.HK; 600050.SH) rose 8.28% to RMB 12.29.

Gohigh Data Networks (000851.SZ), BOCO Inter-Telecom (600289.SH) and Guomai Technologies (002093.SZ) all closed limit-up.

The State Council also indicated December 26 that it is to promote further restructuring of SOEs. However, a telecom industry source close to policy-makers said this did not specifically refer to the telecom sector and that markets were over-reacting.

Keywords: 3G policy State Council Datang Telecom 600198.SH ZTE 0763.HK 000063.SZ China Unicom CHU 0762.HK 600050.SH Gohigh Data Networks 000851.SZ BOCO Inter-Telecom 600289.SH Guomai Technologies 002093.SZ SOE restructuring telecom wireless

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