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Opaque economic outlook bears down on stocks
By Lu Nengneng |
December 2, 2011, Friday
|
Online Edition
Online Edition
SHANGHAI'S key stock index retreated today as caution dominated sentiment on the market, which has been clouded by the unclear economic outlook.
The Shanghai Composite Index dropped 1.1 percent to 2360.66 points, wiping away part yesterday's gains, which were the biggest in six days. Turnover shrank to 57.3 billion yuan (US$9.02 billion) from 95.2 billion yuan.
B shares, which are denominated in yuan but traded in foreign currencies, led the slump. The Shanghai SE B Share Index sank 3.47 percent to 222.61 points, following the lead of tumbling overseas markets, which had turned less optimistic on the liquidity injection program approved by several major central banks.
China's central bank is also geared to dodge a credit crunch after cutting the bank reserve requirement ratio for the first time since 2008 on Wednesday in a bid to pull up economic growth amid the downturn.
Resource stocks paced the slump after yesterday's rise, as the reality of yesterday's weak purchasing managers index sank in. China's PMI had fallen to 49 from last month's 50.4 and paints a less-than-rosy picture of future industrial output.
Jiangxi Copper, the country's largest producer of the metal, slid 2.92 percent to 25.59 yuan. Yanzhou Coal Mining fell 2.52 percent to 25.58 yuan.
More investors tended to take a short position in the shares of electricity producers despite the fact that the authority has recently lifted the power price.
Huaneng Power International retreated 5.88 percent to 4.48 yuan. The Three Gorges Water Conservancy and Electric Power plunged 7.07 percent to 14.05 yuan.
The Shanghai Composite Index dropped 1.1 percent to 2360.66 points, wiping away part yesterday's gains, which were the biggest in six days. Turnover shrank to 57.3 billion yuan (US$9.02 billion) from 95.2 billion yuan.
B shares, which are denominated in yuan but traded in foreign currencies, led the slump. The Shanghai SE B Share Index sank 3.47 percent to 222.61 points, following the lead of tumbling overseas markets, which had turned less optimistic on the liquidity injection program approved by several major central banks.
China's central bank is also geared to dodge a credit crunch after cutting the bank reserve requirement ratio for the first time since 2008 on Wednesday in a bid to pull up economic growth amid the downturn.
Resource stocks paced the slump after yesterday's rise, as the reality of yesterday's weak purchasing managers index sank in. China's PMI had fallen to 49 from last month's 50.4 and paints a less-than-rosy picture of future industrial output.
Jiangxi Copper, the country's largest producer of the metal, slid 2.92 percent to 25.59 yuan. Yanzhou Coal Mining fell 2.52 percent to 25.58 yuan.
More investors tended to take a short position in the shares of electricity producers despite the fact that the authority has recently lifted the power price.
Huaneng Power International retreated 5.88 percent to 4.48 yuan. The Three Gorges Water Conservancy and Electric Power plunged 7.07 percent to 14.05 yuan.
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