Concerns over share glut spook investors
By Ye Zhen |
March 8, 2013, Friday
|
Print Edition
Print Edition
SHANGHAI stocks slipped yesterday on concerns China's securities regulator may soon restart approval of new share offerings, although the regulator relaxed rules to draw more foreign investment in the capital market.
The Shanghai Composite Index lost 0.98 percent to 2,324.29 points.
Market fears over the new share supply renewed after Yao Gang, vice chairman of the China Securities Regulatory Commission, said the regulator will soon resume approval of initial public offerings. As of March 1, 866 firms were waiting to launch IPOs, CSRC data showed.
On Tuesday, the CSRC said the Renminbi Qualified Foreign Institutional Investors program would be expanded so that more overseas investors can invest in the capital market using offshore yuan.
"With the minimum fixed-income cap lifted, and with a wider range of managers now permitted to apply for RQFII, a much broader range of offerings will hit the market, and the lineup of qualified institutions is sure to expand greatly in the next 12 months," Francois Guilloux, analyst with the Z-Ben Advisors, said in a note yesterday. Lenders fell after the People's Bank of China withdrew 5 billion yuan (US$806 million) from the domestic money market via 28-day repurchase agreements.
The Industrial and Commercial Bank of China, the nation's largest lender, shed 1 percent to 4.13 yuan. Shanghai Pudong Development Bank lost 3.2 percent to 10.76 yuan. China Merchants Bank fell 2.5 percent to close at 13.11 yuan.
The Shanghai Composite Index lost 0.98 percent to 2,324.29 points.
Market fears over the new share supply renewed after Yao Gang, vice chairman of the China Securities Regulatory Commission, said the regulator will soon resume approval of initial public offerings. As of March 1, 866 firms were waiting to launch IPOs, CSRC data showed.
On Tuesday, the CSRC said the Renminbi Qualified Foreign Institutional Investors program would be expanded so that more overseas investors can invest in the capital market using offshore yuan.
"With the minimum fixed-income cap lifted, and with a wider range of managers now permitted to apply for RQFII, a much broader range of offerings will hit the market, and the lineup of qualified institutions is sure to expand greatly in the next 12 months," Francois Guilloux, analyst with the Z-Ben Advisors, said in a note yesterday. Lenders fell after the People's Bank of China withdrew 5 billion yuan (US$806 million) from the domestic money market via 28-day repurchase agreements.
The Industrial and Commercial Bank of China, the nation's largest lender, shed 1 percent to 4.13 yuan. Shanghai Pudong Development Bank lost 3.2 percent to 10.76 yuan. China Merchants Bank fell 2.5 percent to close at 13.11 yuan.
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