Shares Surge in China as Investors Snap up Commodities

In Asia Thursday the Shanghai Composite Index climbed 1.5% to 2,749 and the Hang Seng Index fell 0.3% to 23,780. In Japan the Nikkei 225 Index advanced 0.7% to end the day at 10,479.

According to a Bloomberg poll, many are expecting China's recent boom to end in tears. Forty-five percent of the 1,000 people polled think the People's Republic is heading for a financial crisis within the next five years, with another 40% saying bad times will hit by 2016. While it's true that China's exports bring in hard cash, much of China's expansion is also a result of a red-hot property market that more than a few believe has become a bubble.

While not everyone agrees that the party will finish anytime soon, today investors ran for cover, investing in metals and commodities in demand around the world. Copper was especially desirable with its value up 1.3% in London, helped by positive housing reports from the U.S. showing that sales of new houses rose in December -- houses built with copper pipes and wiring. Shares in China's Jiangxi Copper surged 3.8%. Other miners also proved popular with Zijin Mining shooting up 3.5% and Shandong Gold jumping 2.6. Chalco, officially called Aluminum Corp. of China, advanced 1.4%.

Shares in car makers were also on the rise with SAIC, the country's number one car maker climbing 2.8%. The year of the rabbit will be ushered in on Feb. 3, accompanied by a two-week holiday. While some may head out shopping, the government is predicting heavy travel with more than 2.85 billion journeys expected. Bookings on trains are becoming scarce and according to limobroker.com, bookings for rental cars in Beijing during the holiday are up by 300%. Today shares in car maker Beiqi Foton Motor motored up 4.6% and Chongqing Changan leaped 2.4%. Truck maker and exporter Anhui Jianghuai rallied 4.7%.

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In Hong Kong, further restrictions on Chinese property purchases took their toll on real estate shares. Now buyers will have to slap down 60% of the purchase price before they'll get a mortgage on a second home. Then the interest rates on mortgages for second homes will be set at least 10% higher than the benchmark lending rates, says marketwatch.com. China Overseas Land sank 4.9%, Sino Land slid 1.4% and Sun Hung Kai lost 1%. But there were gains for some with Cheung Kong advancing 0.7% and Hang Lung adding 0.3%.

Sir Run Run Shaw, at age 103, has at last made his move, selling most of his shares in TVB. The filmmaker set up TVB following the success of Shaw Brothers, a film studio that put out a long line of Kung Fu films and hits such as The One Armed Swordsman and Shaolin Prince. Today shares plunged 2.9%.

Hong Kong car companies rose with Great Wall Motor jumping 3.4%, Buffett-backed BYD advancing 3% and Geely rising 1.3%.

In Japan positive chat about the state of the U.S. economy pushed up shares in exporters. Fanuc, the industrial robot maker rose 4.6% and Mitsubishi Heavy Industries gained 4%. Camera makers advanced with Canon up 2.2% and Olympus up 1%. Sony racked up a 1.7% gain and competing game console maker Nintendo edged up 0.9%.

Even Toyota, suffering another blow from a new round of recalls, managed a 1.2% gain, while other makers also rose. Honda spiked 2%, Mazda gained 1.2%, Nissan jumped 1% and Isuzu advanced 0.8%.