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Index falls as caution prevails
By Lydia Chen |
September 23, 2011, Friday
|
Print Edition
Print Edition
SHARES of financial institutions, real estate developers and commodity firms tumbled in Shanghai yesterday, pulling the key index down by the most in six weeks, as investors stayed cautious over prospects for China's economic growth.
The Shanghai Composite Index lost 2.8 percent to end at 2,443.06 points.
Concerns over the growth of the world's second-largest economy skewed after a preliminary reading of the HSBC Purchasing Managers' Index showed that China's manufacturing activities in September may contract further due to weakening external demand.
"Everyone is now waiting to see if the government is going to ease its monetary tightening," said Liu Kai, an analyst of Galaxy Securities. "This is the key that can relieve the market."
The Industrial and Commercial Bank of China, the nation's biggest lender, lost 2.9 percent to 4 yuan (63 US cents). Jiangxi Copper tumbled 5.3 percent to 29.07 yuan. China Shenhua Energy fell 3.4 percent to 25.69 yuan, and PetroChina declined 1.7 percent to 9.60 yuan.
"There is no incentive to spur the market right now," Liu said. "Only if more capital is willing to enter the market and turnover starts to expand can we see a sustained rebound."
Poly Real Estate Group Co, China's second-biggest listed developer, retreated 6.9 percent to 9.65 yuan.
Property developers fell after a Reuters report said the banking regulator has ordered trust firms to inform it of business dealings with Greentown China Holdings Ltd. Credit Suisse analyst Du Jinsong said in a report yesterday that it's a signal that the government may try to restrict other sources of financing for developers. Greentown's Hong Kong-traded shares closed 16.2 percent lower at HK$4.49 (58 US cents), the most in nearly three years.
The Shanghai Composite Index lost 2.8 percent to end at 2,443.06 points.
Concerns over the growth of the world's second-largest economy skewed after a preliminary reading of the HSBC Purchasing Managers' Index showed that China's manufacturing activities in September may contract further due to weakening external demand.
"Everyone is now waiting to see if the government is going to ease its monetary tightening," said Liu Kai, an analyst of Galaxy Securities. "This is the key that can relieve the market."
The Industrial and Commercial Bank of China, the nation's biggest lender, lost 2.9 percent to 4 yuan (63 US cents). Jiangxi Copper tumbled 5.3 percent to 29.07 yuan. China Shenhua Energy fell 3.4 percent to 25.69 yuan, and PetroChina declined 1.7 percent to 9.60 yuan.
"There is no incentive to spur the market right now," Liu said. "Only if more capital is willing to enter the market and turnover starts to expand can we see a sustained rebound."
Poly Real Estate Group Co, China's second-biggest listed developer, retreated 6.9 percent to 9.65 yuan.
Property developers fell after a Reuters report said the banking regulator has ordered trust firms to inform it of business dealings with Greentown China Holdings Ltd. Credit Suisse analyst Du Jinsong said in a report yesterday that it's a signal that the government may try to restrict other sources of financing for developers. Greentown's Hong Kong-traded shares closed 16.2 percent lower at HK$4.49 (58 US cents), the most in nearly three years.
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