Investor interest soars as Shanghai stocks hit 13-month high

Individual investors are rushing back to the stock market, with 484,799 new trading accounts opened last week, almost five times this year’s low in January, Bloomberg reported. The Shanghai Composite Index (SCI) rebounded from its biggest drop in five weeks to post a 2.6% gain on Wednesday. It closed at 3,296.62 points, its highest level since June 2008. The index is now up 81% so far this year, second only to Peru’s benchmark, largely thanks to an explosion in bank lending in the first half of the year. Energy companies were the big winners on Wednesday, with China Petroleum and Chemical Corp, also known as Sinopec, posting the maximum permitted daily gain of 10%. PetroChina closed up 5.3% while China Shenhua Energy surged 4.5%. The three stocks accounted for more than half the SCI’s gain for the day. Shares trading in Shanghai are now valued at 36 times earnings, almost triple the November low of 12.9 times.