China shares flat on economic policy uncertainty

Chinese shares were flat Monday amid investor uncertainty about the direction of government economic policy, while metal shares rose on higher commodity prices.

The benchmark Shanghai Composite Index edged up 2.4 points, or 0.1 percent, to 3,110.22. The Shenzhen Composite Index for China's smaller second exchange also gained 0.1 percent, closing at 1,086.84.

Investors were uncertain about the direction of policy after Premier Wen Jiabao said last week Beijing will try to manage inflation. That fueled concern Beijing might tone down its stimulus policies after economic growth accelerated to 8.9 percent in the July-September quarter.

"We might see more bad news from the policy level later as the economy is recovering," said Li Xianming, an analyst for Ping An Securities in the southern city of Shenzhen.

Metals stocks rose as the weak dollar boosted commodity prices.

Jiangxi Copper Ltd., the country's biggest metal producer, jumped 2 percent to 41.83 yuan, while Aluminum Corp. of China added 1.8 percent to 15.09 yuan.

Medical shares gained on expectations of possible higher sales after U.S. President Barack Obama declared swine flu a national emergency. Da An Gene Co., a biotechnology company, surged 9 percent to 16.77 yuan, while Shenzhen Neptunus Bioengineering Co. advanced by the daily 10 percent limit to 14.51 yuan.

Resource shares fell again after oil slipped toward $80 a barrel in Asia.

PetroChina Ltd., Asia's biggest oil and gas producer, shed 0.7 percent to 13.73 yuan, and China Petroleum & Chemical Corp. dropped by 0.6 percent to 12.12 yuan.

China Shenhua Energy Ltd., the country's biggest coal producer, lost 1.1 percent to 36.47 yuan. But Yanzhou Coal Mining Co., rose 3.3 percent to 20.36 yuan, after Australia approved its takeover of coal miner Felix Resources Ltd.

In currency markets, the yuan strengthened to 6.8278 to the U.S. dollar, up from Friday's close of 6.8392.

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