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Chinese shares up 1.8% midday on record high fiscal deficit budget


Chinese shares rose 1.8 percent to 2237 points at midday Thursday over the news of a record high fiscal deficit budget of 950 billion yuan (139 billion U.S. dollars) for 2009.

The benchmark Shanghai Composite Index was up 1.8 percent to 2237 points and the smaller Shenzhen index rose 1.7 percent to close at 8367 points.

Chinese Premier Wen Jiabao announced Thursday at the opening of the parliament's annual session a six-decade-high fiscal deficit budget, saying the total deficit accounts for less than 3 percent of China's gross domestic product (GDP).

The total 950 billion-yuan deficit budget is nearly three times China's last record high deficit, which was 319.8 billion yuan in 2003, but economists said it remained an expansion in the safe range and it would be necessary to spend even more if the country's economic growth further weakens in the second quarter of this year.