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Fed stimulus weighs on Shanghai stocks
By Ye Zhen |
September 17, 2012, Monday
|
Online Edition
Online Edition
SHANGHAI stocks tumbled this morning on concerns that the US Federal Reserve's latest stimulus program may have an negative impact on China's economy and fuel inflation.
The key Shanghai Composite Index lost 1.33 percent, or 28.15 points, to 2,095.70 points. Turnover stood at 34.7 billion yuan (US$5.5 billion) at midday.
The latest easing measures by the US Federal Reserve may exacerbate inflation in China and make it more complicated for the Chinese government to invigorate its economy, analysts said.
China will face more imported inflation as the Fed move may lead to higher prices for energy and other products, said Zhang Ming, senior researcher at the Institute of World Economics and Politics under the Chinese Academy of Social Sciences.
Lu Zhengwei, chief economist at the Industrial Bank, said the QE3 may further limit China's room for monetary easing.
The US central bank announced on Thursday that it will buy US$40 billion of mortgage securities every month until the economy recovers.
Property developers led the market down. China Vanke, the nation's biggest developer, dropped 3.8 percent to 8.02 yuan. Poly Real Estate, the second largest developer, slumped 5.8 percent to 9.81 yuan. Gemdale Corporation fell 3.6 percent to 4.89 yuan.
Cement producers also fell. Anhui Conch Cement Co, China's biggest cement producer, lost 1.6 percent to 15.04 yuan. Zhejiang Jianfeng Group Co, shed 2.4 percent to 10.60 yuan. Gansu Qilianshan Cement Group Co fell 2.8 percent to 10.81 yuan.
Brokerages also declined. CITIC Securities, China's biggest listed brokerage, lost 3.1 percent to 11.01 yuan. Haitong Securities Co sank 2.4 percent to 8.95 yuan. Founder Securities Co dropped 3.4 percent to 4.28 yuan.
The key Shanghai Composite Index lost 1.33 percent, or 28.15 points, to 2,095.70 points. Turnover stood at 34.7 billion yuan (US$5.5 billion) at midday.
The latest easing measures by the US Federal Reserve may exacerbate inflation in China and make it more complicated for the Chinese government to invigorate its economy, analysts said.
China will face more imported inflation as the Fed move may lead to higher prices for energy and other products, said Zhang Ming, senior researcher at the Institute of World Economics and Politics under the Chinese Academy of Social Sciences.
Lu Zhengwei, chief economist at the Industrial Bank, said the QE3 may further limit China's room for monetary easing.
The US central bank announced on Thursday that it will buy US$40 billion of mortgage securities every month until the economy recovers.
Property developers led the market down. China Vanke, the nation's biggest developer, dropped 3.8 percent to 8.02 yuan. Poly Real Estate, the second largest developer, slumped 5.8 percent to 9.81 yuan. Gemdale Corporation fell 3.6 percent to 4.89 yuan.
Cement producers also fell. Anhui Conch Cement Co, China's biggest cement producer, lost 1.6 percent to 15.04 yuan. Zhejiang Jianfeng Group Co, shed 2.4 percent to 10.60 yuan. Gansu Qilianshan Cement Group Co fell 2.8 percent to 10.81 yuan.
Brokerages also declined. CITIC Securities, China's biggest listed brokerage, lost 3.1 percent to 11.01 yuan. Haitong Securities Co sank 2.4 percent to 8.95 yuan. Founder Securities Co dropped 3.4 percent to 4.28 yuan.
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