5G base stations are seen at the National Alpine Ski Center in the Yanqing competition area for the Beijing 2022 Olympic and Paralympic Winter Games on December 14, 2021. Photo: Shen Weiduo/ GT

China’s 6G-related shares edged up on Monday after a senior official pledged to accelerate research and development (R&D) of the next-generation mobile internet technology.

Shares of Guangdong Shenglu Telecommunication, Aoshikang Technology Co and China Satellite Communications Co rose to their daily ceiling of 10 percent as of the market’s close on Monday.

The rally came after Jin Zhuanglong, head of Ministry of Industry and Information Technology (MIIT), said on Sunday on the sidelines of the ongoing two sessions that China will speed up 6G R&D, and strengthen international cooperation in the sector.

This is the second time within a week that the MIIT sent the message, highlighting the country’s 6G push. On March 1, the ministry said it will formulate an action plan to comprehensively promote the R&D of 6G technology. A rapid layout of 6G research is expected to be based on the country’s rich experience in the 5G sector.

China has built the world’s largest 5G mobile network. The country will deploy 600,000 more 5G base stations this year, which will bring the total roll-outs to more than 2.9 million. The number of 5G mobile phone users in China has exceeded 575 million so far, according to Jin.

Apart from 6G, shares related to photovoltaic, wind power and reforms of state-owned enterprises performed well on Monday, while property, finance and coal shares dropped.

The whole A-share market delivered mixed results at Monday’s closing. The benchmark Shanghai Composite Index edged down 0.19 percent to close at 3322.03, the smaller Shenzhen index down slightly by 0.08 percent, while the NASDAQ-style ChiNext board gained 0.38 percent.

A research note by investment bank CICC suggested that some active elements are being unleashed to bolster the market, citing the better-than-expected economic recovery as reflected by economic data in February, as well as a stream of signals sent by the two sessions to stabilize growth and accelerate reforms.

China’s official manufacturing purchasing managers’ index (PMI) rose to 52.6 in February, marking the highest reading since April 2012.

The government work report to the NPC set this year’s economic growth target at around 5 percent, “which is practical and will help boost market confidence, stabilize market expectations, and promote the performance of equities market this year,” Yang Delong, chief economist at Shenzhen-based First Seafront Fund Management Co, told the Global Times.

It is expected that the exchange rate of the Chinese yuan vs the US dollar will likely to appreciate through the year, which will help attract the inflow of foreign capital, according to Yang.

“China’s quality assets are attractive to foreign investors, which could be an important back-up for the A-share market to go upward. With the economic recovery on track and the US Fed’s interest rate hike possibly coming to an end in the second half of 2023, the A-share market is expected to gain more impetus this year,” Yang said.

Global Times