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Shanghai index drops over profit worries
By Ye Zhen |
May 14, 2012, Monday
|
Online Edition
Online Edition
SHANGHAI stocks dipped as a report showed around half of the 845 listed companies will post slower profit growth in the first half of this year.
The report overshadowed the central bank's Saturday move of cutting the reserve requirement ration by 50 basis points to prevent the world's second largest economy from suffering a hard landing.
The benchmark Shanghai Composite Index slipped 0.59 percent, or 14.25 points to 2,380.73. Turnover stood at 89.3 billion yuan (US$14.2 billion) at the trading close.
As of yesterday, 384 listed companies have forecast that their net profit will grow at a slower pace in the first half of 2012, accounting for 45.4 percent of the 845 companies that published earnings preannouncements, data from Wind Information Co showed.
The bearish report raised concern that China's economic slowdown is deepening.
The People's Bank of China, the nation's central bank, cut the reserve requirement ratio by 50 basis points, effective on Friday. It was the second time this year the central bank cut the ratio.
The ratio for large commercial banks will decline to 20 percent while it will drop to 16.5 percent for medium and small banks. The move may add about 420 billion to the financial system.
Zhejiang Guangsha Co led property developers higher on the central's bank's move, increasing 5.9 percent to 5.21 yuan. Poly Real Estate Group Co, China's second largest listed developer, gained 1.1 percent to 12.77 yuan.
Biological Pharmacy rallied against the falling index on government policies to encourage mergers and the reorganization of medical enterprises. Chongqing Taiji Industry, Henan Topfond Pharmaceutical Co, and NanJing Pharmaceutical Co all surged the daily limit of 10 percent to 8.14 yuan, 7.50 yuan and 5.08 yuan respectively.
Guangzhou Pharmaceutical Co surged the daily limit of 10 percent to 20.91 yuan as its parent company, Guangzhou Pharmaceutical Holdings Limited, took back the right to use the trademark of China's renowned Wong Lo Kat Herbal Tea from Hong Kong-based JDB Group.
The report overshadowed the central bank's Saturday move of cutting the reserve requirement ration by 50 basis points to prevent the world's second largest economy from suffering a hard landing.
The benchmark Shanghai Composite Index slipped 0.59 percent, or 14.25 points to 2,380.73. Turnover stood at 89.3 billion yuan (US$14.2 billion) at the trading close.
As of yesterday, 384 listed companies have forecast that their net profit will grow at a slower pace in the first half of 2012, accounting for 45.4 percent of the 845 companies that published earnings preannouncements, data from Wind Information Co showed.
The bearish report raised concern that China's economic slowdown is deepening.
The People's Bank of China, the nation's central bank, cut the reserve requirement ratio by 50 basis points, effective on Friday. It was the second time this year the central bank cut the ratio.
The ratio for large commercial banks will decline to 20 percent while it will drop to 16.5 percent for medium and small banks. The move may add about 420 billion to the financial system.
Zhejiang Guangsha Co led property developers higher on the central's bank's move, increasing 5.9 percent to 5.21 yuan. Poly Real Estate Group Co, China's second largest listed developer, gained 1.1 percent to 12.77 yuan.
Biological Pharmacy rallied against the falling index on government policies to encourage mergers and the reorganization of medical enterprises. Chongqing Taiji Industry, Henan Topfond Pharmaceutical Co, and NanJing Pharmaceutical Co all surged the daily limit of 10 percent to 8.14 yuan, 7.50 yuan and 5.08 yuan respectively.
Guangzhou Pharmaceutical Co surged the daily limit of 10 percent to 20.91 yuan as its parent company, Guangzhou Pharmaceutical Holdings Limited, took back the right to use the trademark of China's renowned Wong Lo Kat Herbal Tea from Hong Kong-based JDB Group.
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