US Prudential’s China JV to launch 10 bn yuan fund

US Prudential’s China JV to launch 10 bn yuan fund
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First Published: Tue, Aug 14 2007. 12 23 PM IST
Updated: Tue, Aug 14 2007. 12 23 PM IST
Charlie Zhu / Reuters
Shanghai: US insurer Prudential Financial’s fund management venture in China will launch a local A-share fund to raise up to 10 billion yuan ($1.32 billion), the venture’s chief investment officer said.
The fund, whose launch was approved by Chinese regulators this month, will focus on large-cap stocks, James Yuan of the Shanghai-based joint venture, Everbright Pramerica Fund Management Co., told Reuters.
Beijing has approved a string of new stock funds over the past month in an apparent bid to shore up the stock market ahead of a key Communist Party meeting later this year and a flood of new share offers by large state firms.
The pace of new fund launches and demand for the products are closely monitored by Chinese institutional investors to help predict the near-to medium-term trend of the overall stock market, fund managers said.
The 30%-plus gain in the benchmark Shanghai composite index since early July was largely due to new funds’ purchases of large-cap stocks, particularly financials such as the Industrial & Commercial Bank of China, they said.
The index has rallied about 80% so far this year.
China Post & Capital Fund Management Co. attracted nearly 60 billion yuan in subscriptions to a new mutual fund on Monday, 13 August, forcing it to close the sale on the first day since it was only allowed to raise a maximum of 15 billion yuan.
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First Published: Tue, Aug 14 2007. 12 23 PM IST