Key index falls to 3-month low
By Feng Jianmin |
May 13, 2011, Friday
|
Print Edition
Print Edition
SHANGHAI'S key stock index yesterday fell the most in a week to a three-month low, after oil and copper prices shed overnight amid concerns over slower economic growth for China.
The Shanghai Composite Index fell 1.4 percent, or 39.34 points, to 2,844.08, the lowest close since February 11.
Oil prices for June delivery shed 5.5 percent to below US$100 a barrel overnight Wednesday in New York after the US dollar firmed amid the debt crisis in some European Union nations and China's industrial output slowed in April. Copper for June delivery fell 2 percent in London.
"China's industrial production, retail sales, and Producer Price Index for April all came slightly below market consensus, which suggests that the tightening monetary policies have some effect without causing major damage," said James Zhang, a researcher at Standard Bank. "Metals will remain under pressure but data from China Customs suggested China's oil imports are likely to stay strong."
Oil and metal producers led the decline. PetroChina, the index's biggest component, lost 1.3 percent to 11.03 yuan. Sinopec dropped 1 percent to 8.32 yuan. Jiangxi Copper Co, China's largest producer of the metal, slid 3.5 percent to 32.62 yuan.
Shandong Gold Mining Group Co shed 4.6 percent to 44.22 yuan. Zijin Mining Co lost 2.5 percent to 7.13 yuan.
"The tumble in commodity prices has dragged heavyweights lower and led the index down," said Xu Dawei, an analyst at Western Securities. "The resumption of selling three-year bills may help the government to slow its tightening steps."
The People's Bank of China issued 40 billion yuan worth of three-year bills for the first time in six months in April. The PBOC has withdrawn 12 billion yuan through open market operations this week, ending a capital injection for three consecutive weeks.
The Shanghai Composite Index fell 1.4 percent, or 39.34 points, to 2,844.08, the lowest close since February 11.
Oil prices for June delivery shed 5.5 percent to below US$100 a barrel overnight Wednesday in New York after the US dollar firmed amid the debt crisis in some European Union nations and China's industrial output slowed in April. Copper for June delivery fell 2 percent in London.
"China's industrial production, retail sales, and Producer Price Index for April all came slightly below market consensus, which suggests that the tightening monetary policies have some effect without causing major damage," said James Zhang, a researcher at Standard Bank. "Metals will remain under pressure but data from China Customs suggested China's oil imports are likely to stay strong."
Oil and metal producers led the decline. PetroChina, the index's biggest component, lost 1.3 percent to 11.03 yuan. Sinopec dropped 1 percent to 8.32 yuan. Jiangxi Copper Co, China's largest producer of the metal, slid 3.5 percent to 32.62 yuan.
Shandong Gold Mining Group Co shed 4.6 percent to 44.22 yuan. Zijin Mining Co lost 2.5 percent to 7.13 yuan.
"The tumble in commodity prices has dragged heavyweights lower and led the index down," said Xu Dawei, an analyst at Western Securities. "The resumption of selling three-year bills may help the government to slow its tightening steps."
The People's Bank of China issued 40 billion yuan worth of three-year bills for the first time in six months in April. The PBOC has withdrawn 12 billion yuan through open market operations this week, ending a capital injection for three consecutive weeks.
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