Fears of stricter property curbs hit index
Source: Shanghai Daily |
May 26, 2011, Thursday
|
Print Edition
Print Edition
SHANGHAI'S key stock index yesterday fell for a fifth day, on concerns the government will intensify curbs on the property market and tighter monetary policies may hurt earnings.
The Shanghai Composite Index lost 0.9 percent to 2,741.74, the lowest since January 26.
"Monetary policies and property tightening will be in place in the foreseeable future," said Wei Wei, an analyst at West China Securities Co. "Though the external environment is improving, there's not much room for stocks to move because of domestic tightening policies."
Goldman Sachs on Tuesday downgraded expectations for China's economic growth this year to 9.4 percent from a previous 10 percent while that for 2012 was also revised down to 9.2 percent from 9.5 percent.
The United States investment bank predicted China's inflation to rise to 5.6 percent in June, the highest level since July 2008.
It also said that it can't rule out the possibility the mainland's A-share market may correct downward by 5 to 10 percent in the short term.
Banks and property developers were hit by a Shanghai Securities News report that China may take an even tougher stance to curb home prices.
The Industrial and Commercial Bank of China, the country's biggest lender, shed 1.8 percent to 4.36 yuan. China Construction Bank, the second-biggest, slid 1.2 percent to 4.91 yuan. Poly Real Estate Group Co, China's second-biggest developer, shed 0.8 percent to 9.84 yuan.
China will curb speculative demand for homes and maintain stable real estate prices to control the property market, the newspaper said yesterday, citing Ni Hong, director of the housing reform and development department of the Ministry of Housing and Urban-Rural Development.
Liquidity continues to be tight as the seven-day repurchase rate, an indication of borrowing cost among banks, jumped to a three-month high of 5.31 percent yesterday.
The Shanghai Composite Index lost 0.9 percent to 2,741.74, the lowest since January 26.
"Monetary policies and property tightening will be in place in the foreseeable future," said Wei Wei, an analyst at West China Securities Co. "Though the external environment is improving, there's not much room for stocks to move because of domestic tightening policies."
Goldman Sachs on Tuesday downgraded expectations for China's economic growth this year to 9.4 percent from a previous 10 percent while that for 2012 was also revised down to 9.2 percent from 9.5 percent.
The United States investment bank predicted China's inflation to rise to 5.6 percent in June, the highest level since July 2008.
It also said that it can't rule out the possibility the mainland's A-share market may correct downward by 5 to 10 percent in the short term.
Banks and property developers were hit by a Shanghai Securities News report that China may take an even tougher stance to curb home prices.
The Industrial and Commercial Bank of China, the country's biggest lender, shed 1.8 percent to 4.36 yuan. China Construction Bank, the second-biggest, slid 1.2 percent to 4.91 yuan. Poly Real Estate Group Co, China's second-biggest developer, shed 0.8 percent to 9.84 yuan.
China will curb speculative demand for homes and maintain stable real estate prices to control the property market, the newspaper said yesterday, citing Ni Hong, director of the housing reform and development department of the Ministry of Housing and Urban-Rural Development.
Liquidity continues to be tight as the seven-day repurchase rate, an indication of borrowing cost among banks, jumped to a three-month high of 5.31 percent yesterday.
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