Investors wary over lenders' exposure
By Lydia Chen |
August 1, 2011, Monday
|
Print Edition
Print Edition
THE Shanghai stock market is expected to be more volatile this week as investors stay wary over the exposure of Chinese banks' huge lending made to local governments' financing arms, according to analysts who added that inflation for July may hit a record high.
The Shanghai Composite Index may fall to 2,610 points this week after it lost 2.49 percent last week and declined 2.18 percent for July. The index slipped 0.26 percent to close at 2,701.73 last Friday.
In trading last week banks were the biggest drag on the market amid investor concerns over massive government debts borrowed under China's 4 trillion yuan (US$621 billion) stimulus package during the global financial crisis, according to a note by Qin Hong, an analyst with Wuxi Jinbailing Investment Consulting Co.
The heavy declines among banks have already hurt investor confidence in the market, he added.
Meanwhile, China may soon announce its July inflation data.
The Consumer Price Index, a general gauge of inflation, may hit 6.7 percent from a three-year record of 6.4 percent in June, said Kou Wenhong, a manager at China Nature Asset Management Co.
The Shanghai-based fund company forecast China's economy will continue to slow in August, adding to investors' concerns.
Kou suggested investors should focus more attention on small- and medium-sized companies as well as consumption-related counters.
The Shanghai Composite Index may fall to 2,610 points this week after it lost 2.49 percent last week and declined 2.18 percent for July. The index slipped 0.26 percent to close at 2,701.73 last Friday.
In trading last week banks were the biggest drag on the market amid investor concerns over massive government debts borrowed under China's 4 trillion yuan (US$621 billion) stimulus package during the global financial crisis, according to a note by Qin Hong, an analyst with Wuxi Jinbailing Investment Consulting Co.
The heavy declines among banks have already hurt investor confidence in the market, he added.
Meanwhile, China may soon announce its July inflation data.
The Consumer Price Index, a general gauge of inflation, may hit 6.7 percent from a three-year record of 6.4 percent in June, said Kou Wenhong, a manager at China Nature Asset Management Co.
The Shanghai-based fund company forecast China's economy will continue to slow in August, adding to investors' concerns.
Kou suggested investors should focus more attention on small- and medium-sized companies as well as consumption-related counters.
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