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SSE edges up despite PMI fall
By Lydia Chen |
November 1, 2011, Tuesday
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Online Edition
Online Edition
SHANGHAI Stock Exchange bounced between gaining and losing territories today as expectations that China may unveil more policies to spur economic growth were offset by the country's manufacturing index falling to a more than two year low.
The Shanghai Composite Index edged up 0.07 percent in the last minutes of today's trade to close at 2,470.02. Turnover increased to 85 billion (US$13.43 billion) from 81.8 billion yuan yesterday.
Insurers led financial plays higher while automakers also helped the market stay in positive territory. China Pacific Insurance Group hiked 3.83 percent to 20.35 yuan. Beiqi Foton Motor Co gained 5.02 percent to 7.95 yuan.
But the gains were overshadowed by slumps among manufacturing plays after the Purchasing Managers' Index fell to 50.4 in October from 51.2 in September, the lowest level since February 2009, the China Federation of Logistics and Purchasing said in a statement today.
A reading above 50 indicates expansion.
The index, which is a reflection of manufacturing in the world's second largest economy, is expected to slow down further in the fourth quarter as exports to markets in the West may slump.
Developers were also one of the biggest drags after a report by SouFun, the country's largest real estate website owner, said home prices posted bigger drops in October.
Poly Real Estate Co, the country's second largest developer by market value, shed 3.49 percent to 9.95 yuan.
Home prices dropped 0.23 percent last month from September when they retreated 0.03 percent according to SouFun. Prices slid in 58 of 100 cities tracked by the company, including Shanghai and Beijing, it said in a statement.
In Beijing, a total of 13,000 homes, including new and second homes, were sold in October, the lowest so far this year, according to the capital's official housing transaction website.
Despite possible pressure from real estate plays, Wang Hanfeng, an analyst with Gaohua Securities, said a rebound in the A-share market was irreversible.
Although growth would slow next year, China was very likely to ease its monetary tightening as inflation start to fall, said Wang, whose company is the Chinese partner of Goldman Sachs.
The Shanghai Composite Index edged up 0.07 percent in the last minutes of today's trade to close at 2,470.02. Turnover increased to 85 billion (US$13.43 billion) from 81.8 billion yuan yesterday.
Insurers led financial plays higher while automakers also helped the market stay in positive territory. China Pacific Insurance Group hiked 3.83 percent to 20.35 yuan. Beiqi Foton Motor Co gained 5.02 percent to 7.95 yuan.
But the gains were overshadowed by slumps among manufacturing plays after the Purchasing Managers' Index fell to 50.4 in October from 51.2 in September, the lowest level since February 2009, the China Federation of Logistics and Purchasing said in a statement today.
A reading above 50 indicates expansion.
The index, which is a reflection of manufacturing in the world's second largest economy, is expected to slow down further in the fourth quarter as exports to markets in the West may slump.
Developers were also one of the biggest drags after a report by SouFun, the country's largest real estate website owner, said home prices posted bigger drops in October.
Poly Real Estate Co, the country's second largest developer by market value, shed 3.49 percent to 9.95 yuan.
Home prices dropped 0.23 percent last month from September when they retreated 0.03 percent according to SouFun. Prices slid in 58 of 100 cities tracked by the company, including Shanghai and Beijing, it said in a statement.
In Beijing, a total of 13,000 homes, including new and second homes, were sold in October, the lowest so far this year, according to the capital's official housing transaction website.
Despite possible pressure from real estate plays, Wang Hanfeng, an analyst with Gaohua Securities, said a rebound in the A-share market was irreversible.
Although growth would slow next year, China was very likely to ease its monetary tightening as inflation start to fall, said Wang, whose company is the Chinese partner of Goldman Sachs.
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