SHANGHAI stocks inched up this morning, led by shipbuilders, while cement producers and distilleries declined.

The benchmark Shanghai Composite Index added 1.84 points, or 0.09 percent, to 2,163.88. Turnover was 38.2 billon yuan (US$6.3 billion) by the noon break.

The index slumped 2.2 percent last week after a raft of data showed China's economic growth is losing momentum with sluggish foreign trade, slowing industrial output and weak credit demand.

Huatai Securities said the market is likely to have a technical rebound this week after recent falls while investor sentiment will improve as the central bank suspended regular money withdrawal to ease liquidity crunch while investment companies increased their holdings of A shares.

China Everbright Bank Co rose 2.4 percent to 3 yuan. New China Life Insurance Co Ltd climbed 4.8 percent to 22.69 yuan after Central Huijin Investment Ltd, a state-owned investment company, increased its holdings in the two firms.

Shipbuilders advanced the most on speculations that China may have started developing nuclear reactors for its future aircraft carriers.

China CSSC Holdings Ltd surged by the daily limit of 10 percent to 19.13 yuan. CSSC Jiangnan Heavy Industry Co leaped 8 percent to 13.65 yuan. Asian Star Anchor Chain Co added 7.6 percent to 7.25 yuan.

Cement producers fell the most. Anhui Conch Cement Co, the country's biggest cement producer, lost 2.5 percent to 14.10 yuan. Gansu Qilianshan Cement Group Co fell 2.2 percent to 9.69 yuan.

Distilleries also declined. Kweichow Moutai Co, a leading producer of high-end liquor in China, shed 0.9 percent to 192.22 yuan. Shanxi Xinghuacun Fen Wine Factory Co lost 2 percent to 27 yuan.