Key index falls most in 2 weeks to below 2,800
By Lydia Chen |
January 11, 2011, Tuesday
|
Print Edition
Print Edition
SHANGHAI stocks yesterday fell the most in two weeks to end below 2,800 points as drug makers, property developers and financial shares slumped amid jittery investors.
The Shanghai Composite Index lost 1.66 percent, or 46.99 points, to close at 2,791.81. This was the biggest drop since December 28. Turnover fell to 110.8 billion yuan (US$ 16.71 billion) from Friday's 137.2 billion yuan.
"The weak market performance continued because investors were still unsure about the direction of the market," according to Chen Kaiwei, an analyst with Changjiang Securities.
Investors took profits on drug makers which had rallied for quite some time. Jiangsu Hengrui Medicine Co plunged 5.36 percent to 53 yuan. Zhejiang Medicine Co dropped 2.92 percent to 32.23 yuan.
Financial shares and property developers also fell. The Industrial and Commercial Bank of China, the country's biggest lender shed 1.4 percent to 4.24 yuan. Poly Real Estate Group Co fell 3 percent to 13.96 yuan.
China is set to release housing prices for December and last year this week, and investors were nervous that more tightened policies may be unveiled if the data show measures launched may have been ineffective in curbing asset bubbles.
"The drop among banks and developers was partly because of a weaker-than-expected liquidity improvement in the market this month," said Zhong Hua, an analyst of Guotai Junan Securities.
"China's central bank is still keeping a close eye on all the lenders' loan businesses."
He predicted the index would dip to between 2,600 and 2,700 points. Telecommunication, transport and shipbuilding stocks may be good investments this week, Zhong said.
The Shanghai Composite Index lost 1.66 percent, or 46.99 points, to close at 2,791.81. This was the biggest drop since December 28. Turnover fell to 110.8 billion yuan (US$ 16.71 billion) from Friday's 137.2 billion yuan.
"The weak market performance continued because investors were still unsure about the direction of the market," according to Chen Kaiwei, an analyst with Changjiang Securities.
Investors took profits on drug makers which had rallied for quite some time. Jiangsu Hengrui Medicine Co plunged 5.36 percent to 53 yuan. Zhejiang Medicine Co dropped 2.92 percent to 32.23 yuan.
Financial shares and property developers also fell. The Industrial and Commercial Bank of China, the country's biggest lender shed 1.4 percent to 4.24 yuan. Poly Real Estate Group Co fell 3 percent to 13.96 yuan.
China is set to release housing prices for December and last year this week, and investors were nervous that more tightened policies may be unveiled if the data show measures launched may have been ineffective in curbing asset bubbles.
"The drop among banks and developers was partly because of a weaker-than-expected liquidity improvement in the market this month," said Zhong Hua, an analyst of Guotai Junan Securities.
"China's central bank is still keeping a close eye on all the lenders' loan businesses."
He predicted the index would dip to between 2,600 and 2,700 points. Telecommunication, transport and shipbuilding stocks may be good investments this week, Zhong said.
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