The story appears on

Page A14

November 24, 2010

GET this page in PDF

Free for subscribers

View shopping cart

Related News

Home » Business » Finance

Liquidity woes pull index down

SHANGHAI'S key stock index dropped to its lowest in more than six weeks on concerns that the central government may curb lending to control liquidity. Miners and banks led the declines.

The Shanghai Composite Index lost 2 percent, or 56 points, to close at 2,828.28, the lowest since October 11. Turnover fell to 148 billion yuan (US$22.3 billion) from yesterday's 165.3 billion yuan.

The index has lost more than 10 percent since reaching an almost seven-month high on November 8.

Media reported that lending in the first three weeks of November has exceeded that of the whole of October, and the loan target that was set for this year has almost been used up by now.

Banks were lending aggressively on concerns that the central government may unveil more measures to curb credit next year, Securities Times reported yesterday, citing analysts.

"Liquidity will drop over the short term because both the government and banks face pressures on loan size by the end of the year," Ping An Securities said in a note.

Banks were weak. The Agricultural Bank of China shed 1.1 percent to 2.62 yuan. China Construction Bank lost 1.5 percent to 4.60 yuan. China Merchants Bank fell 1 percent to 13.11 yuan.

Miners fell as metal futures in Shanghai and overseas markets declined. Investors are worried that China's measures to curb inflation may hurt economic growth, and that European demand may ease as governments there tightened their budgets.

Jiangxi Copper Co fell 5.3 percent to 34.19 yuan. Aluminum Corp of China lost 4.1 percent to end at 10.20 yuan. Datong Coal Industry Co declined 1.3 percent to close at 20.92 yuan.




 

Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend