Sell-off sees index fall below 2,000 mark
By Ye Zhen |
July 20, 2013, Saturday
|
Print Edition
Print Edition
A MASSIVE sell-off across the board dragged the key Shanghai stock index down below the 2,000-point mark yesterday, with property developers and financial firms leading the decline.
The Shanghai Composite Index slumped 1.52 percent to 1,992.65. The barometer ended the week with a 2.3 percent loss, ending a two-week winning streak.
Homebuilders recorded a 3.7 percent drop, dented by talk about the potential expansion of a pilot property tax program being trialed in Shanghai and Chongqing.
Poly Real Estate, China's second-largest listed developer, slid 5.6 percent, the biggest fall in four weeks, to 10.18 yuan (US$1.66).
Meidu Holding Co, a Hangzhou-based developer, plunged 8 percent to 4.13 yuan, after a 10 percent surge the previous trading day.
"The property industry is entering a downward trajectory due to a tighter liquidity environment in the second half of the year that sees funds flow back to developed countries," Luo Yu, an analyst with research firm CEBM Group Ltd, said in an industry report yesterday.
"Meanwhile, current property restrictions are expected to keep in place as upward pressure on home prices remains," Luo added.
China Minsheng Banking Corp led the falls among financial firms. This came as the Wall Street Journal cited investment research firm Sanford C. Bernstein as saying the lender's exposure to the interbank market is more than 30 percent of its balance sheet.
Minsheng Banking dropped 3.8 percent to 8.41 yuan - taking it down around 15 percent from mid-June.
Shanghai Pudong Development Bank fell 2.1 percent to 8.03 yuan.
The Industrial Bank lost 3.3 percent to 9.37 yuan.
The Shanghai Composite Index slumped 1.52 percent to 1,992.65. The barometer ended the week with a 2.3 percent loss, ending a two-week winning streak.
Homebuilders recorded a 3.7 percent drop, dented by talk about the potential expansion of a pilot property tax program being trialed in Shanghai and Chongqing.
Poly Real Estate, China's second-largest listed developer, slid 5.6 percent, the biggest fall in four weeks, to 10.18 yuan (US$1.66).
Meidu Holding Co, a Hangzhou-based developer, plunged 8 percent to 4.13 yuan, after a 10 percent surge the previous trading day.
"The property industry is entering a downward trajectory due to a tighter liquidity environment in the second half of the year that sees funds flow back to developed countries," Luo Yu, an analyst with research firm CEBM Group Ltd, said in an industry report yesterday.
"Meanwhile, current property restrictions are expected to keep in place as upward pressure on home prices remains," Luo added.
China Minsheng Banking Corp led the falls among financial firms. This came as the Wall Street Journal cited investment research firm Sanford C. Bernstein as saying the lender's exposure to the interbank market is more than 30 percent of its balance sheet.
Minsheng Banking dropped 3.8 percent to 8.41 yuan - taking it down around 15 percent from mid-June.
Shanghai Pudong Development Bank fell 2.1 percent to 8.03 yuan.
The Industrial Bank lost 3.3 percent to 9.37 yuan.
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