Drop in FDI into China hits key index
By Ye Zhen |
August 17, 2012, Friday
|
Print Edition
Print Edition
SHANGHAI stocks ended lower yesterday after foreign investment inflows into China fell in July, overshadowing remarks by Premier Wen Jiabao that the country could meet this year's economic target.
The Shanghai Composite Index shed 0.32 percent to close at 2,112.20 points, the lowest level since August 2.
China recorded a 8.7 percent decline in foreign investment inflows in July from a year earlier to US$7.58 billion, the Ministry of Commerce said yesterday. That extended the annual drop of 6.9 percent in June as the world's second largest economy slowed further.
China drew US$66.7 billion in foreign direct investment in the first seven months, down 3.6 percent annually.
The flagging economy is one of the factors pulling FDI in China down for two consecutive months, said Shen Danyang, a ministry spokesman. A drop in land supply and rising labor cost in the domestic market also drove foreign capital away, he added.
Wen said during a trip to Zhejiang Province that China would meet the annual targets for social and economic growth. He signaled that monetary policy tools may be further extended as inflation eases.
Zhang Zhiwei, chief economist for China at Nomura Securities, said Wen's comments indicated China may cut bank reserve requirement ratio this month.
Tsingtao Brewery Co fell 4 percent to end at 33.10 yuan (US$5.20) after it reported a 1.8 percent gain in first-half profit, down from an annual 21.6 percent. Kweichow Moutai Co shed 2 percent to 239.28 yuan and Sichuan Tuopai Shede Wine Co shrank 4.3 percent to 33.93 yuan.
The Shanghai Composite Index shed 0.32 percent to close at 2,112.20 points, the lowest level since August 2.
China recorded a 8.7 percent decline in foreign investment inflows in July from a year earlier to US$7.58 billion, the Ministry of Commerce said yesterday. That extended the annual drop of 6.9 percent in June as the world's second largest economy slowed further.
China drew US$66.7 billion in foreign direct investment in the first seven months, down 3.6 percent annually.
The flagging economy is one of the factors pulling FDI in China down for two consecutive months, said Shen Danyang, a ministry spokesman. A drop in land supply and rising labor cost in the domestic market also drove foreign capital away, he added.
Wen said during a trip to Zhejiang Province that China would meet the annual targets for social and economic growth. He signaled that monetary policy tools may be further extended as inflation eases.
Zhang Zhiwei, chief economist for China at Nomura Securities, said Wen's comments indicated China may cut bank reserve requirement ratio this month.
Tsingtao Brewery Co fell 4 percent to end at 33.10 yuan (US$5.20) after it reported a 1.8 percent gain in first-half profit, down from an annual 21.6 percent. Kweichow Moutai Co shed 2 percent to 239.28 yuan and Sichuan Tuopai Shede Wine Co shrank 4.3 percent to 33.93 yuan.
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