China shares outlook - Higher on Wall St, Social Security Fund investment hopes.

(From AFX Europe (Focus))

SHANGHAI (XFN-ASIA) - China shares are expected to open higher after a firmer close on Wall Street on Friday, with sentiment also likely to be supported by hopes of further investment by the social security fund, dealers said.

The official Xinhua news agency reported on late Friday that the National Council for Social Security Fund (SSF) will increase its investment in the stock market and buy stakes in the restructured China Development Bank and Agricultural Bank of China.

Citing fund chairman Dai Xianglong, the report said that SSF will increase its index investment gradually and raise its investment in some stocks "to stabilize market confidence and seek long-term stable returns."

However, dealers cautioned that gains may be limited amid persistent worries about the deteriorating economy and share supply pressure as large numbers of shares come out of lockup in December.

On the US market, the Dow rose 1.17 pct, while crude was flat, settling down a penny at 54.43 usd a barrel on the New York Mercantile Exchange.

The benchmark Shanghai Composite Index closed down 46.71 points or 2.44 pct at 1,871.16 on Friday, led by financials and ...