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Ping An Shares Advance Despite Dismal Results

Shares in Ping An Insurance, the world's second-largest insurer by market value, rose more than 5 percent on Thursday as investors shrugged off its weak fourth quarter and instead focussed on its more upbeat 2009 outlook.

Ping An posted a 1.34 billion yuan (US$196 million) loss for October-December, due to losses related to its investment in failed European financial group Fortis. Earnings for the full year, excluding the Fortis investment, came in more or less in line with market expectations.

But analysts see a brighter outlook for the Chinese insurer, which is expected to benefit from a stabilising stock market and rapidly growing premium incomes.

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"Sentiment for the full year will continue to be fuelled by a better investment and premium outlook," said Merrill Lynch analysts.

The brokerage raised its target price on the stock by 12.5 percent to HK$54 on higher growth expectations.

Some of the overhang on the stock was also removed on relief that Fortis-related losses are now fully reflected in Ping An's books.

The stock was up 4.8 percent, outperforming the 1.6 percent gain on the main index. After slumping 55 percent in 2008, shares in Ping An have clawed back 36 percent so far this year partly helped by the rebound in mainland Chinese equity markets.