DOMESTIC stock markets will still be in the middle of a bull run next year, most fund managers said in a survey conducted by Securities Times newspaper.

The survey covered 72 fund managers in Shanghai, Beijing, Shenzhen and Guangzhou, with 83 percent saying that China's markets will still be gaining ground next year. Forty percent of all interviewees said the index will conquer 8,000 points next year.

Only four managers said it will be below 6,000 points. The Shanghai Composite Index added 0.96 percent to close at 5,032.13 yesterday.

About 27 percent of respondents said the financial industry will be the most prosperous sector next year, and 19 percent of the managers chose the real estate industry, the survey said.

Half of the managers said the funds they manage will grow 20 to 40 percent next year, the survey said.

Thirty-two percent of respondents will focus on stocks that will benefit from the appreciation of the yuan, and 26 percent will target companies that have restructuring or buyout proposals, the report said.

Sagging investment confidence and sluggish overseas markets pulled down the Shanghai index, which has dropped 18 percent since it surged to an all-time high of 6,092.06 on October 16.

Concerns about high valuation, the central government's austerity measures to drain liquidity and the potential for an economic slowdown in the United States added pressure on the index.