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Shanghai stocks decline slightly to end week
By Feng Jianmin |
July 1, 2011, Friday
|
Online Edition
Online Edition
SHANGHAI equities dipped today after a key manufacturing index dropped to the lowest level in two and a half years .
The Shanghai Composite Index, which tracks the bigger mainland bourse, lost 0.11 percent to close at 2,759.36. Turnover rose to 106.5 billion yuan (US$16.5 billion).
The Shenzhen Component Index, which covers the smaller bourse, added 0.55 percent to 12,178.08.
China's official purchasing managers' index dropped to the lowest in two and a half years in June, as the government stepped up efforts to rein in inflation and asset price bubbles.
The Purchasing Managers' Index, an indicator of manufacturing sector operating conditions, was at 50.9 in June compared with 52 in May, the China Federation of Logistics and Purchasing said in a statement today.
The reading was the lowest since February 2009 and was edging down towards the 50-point level, above which an expansion is expected.
The manufacturing index is based on a survey of purchasing managers in more than 820 companies in 20 industries.
"The index is lower than the market expectations of 51.5 percent," the China International Capital Corporation wrote in a report. "Flood in southern China and current tight liquidity is limiting manufacturing expansion in the mid-term, and the situation is worse for small and medium sized enterprises."
The report estimated that monetary policies will remain tight despite slower economic growth and the central government may raise interest rates once in July.
But a hard landing is not likely because investment and consumption is still growing stably, the report said.
Property developers led the gainers on speculation that control on the sector will ease after the country speeds up its construction of massive affordable houses. China Merchants Property Development Co rose 2.7 percent to 18.80 yuan. Poly Real Estate Co added 2.3 percent to 11.24 yuan.
Retailers rose on speculation that people will spend more after China's legislature said it's raising the minimum personal income required to pay taxes from 2,000 yuan to 3,500 yuan. Zhejiang Commodities Cities Group climbed 3.4 percent to 12.71 yuan. Fujian Dongbai Group Co jumped 4 percent to 8.99 yuan.
Large banks dropped on worries about sour debt. Industrial and Commercial Bank of China lost 1.8 percent to 4.38 yuan. China Merchants Bank eased 0.6 percent to 12.94 yuan.
The Shanghai Composite Index, which tracks the bigger mainland bourse, lost 0.11 percent to close at 2,759.36. Turnover rose to 106.5 billion yuan (US$16.5 billion).
The Shenzhen Component Index, which covers the smaller bourse, added 0.55 percent to 12,178.08.
China's official purchasing managers' index dropped to the lowest in two and a half years in June, as the government stepped up efforts to rein in inflation and asset price bubbles.
The Purchasing Managers' Index, an indicator of manufacturing sector operating conditions, was at 50.9 in June compared with 52 in May, the China Federation of Logistics and Purchasing said in a statement today.
The reading was the lowest since February 2009 and was edging down towards the 50-point level, above which an expansion is expected.
The manufacturing index is based on a survey of purchasing managers in more than 820 companies in 20 industries.
"The index is lower than the market expectations of 51.5 percent," the China International Capital Corporation wrote in a report. "Flood in southern China and current tight liquidity is limiting manufacturing expansion in the mid-term, and the situation is worse for small and medium sized enterprises."
The report estimated that monetary policies will remain tight despite slower economic growth and the central government may raise interest rates once in July.
But a hard landing is not likely because investment and consumption is still growing stably, the report said.
Property developers led the gainers on speculation that control on the sector will ease after the country speeds up its construction of massive affordable houses. China Merchants Property Development Co rose 2.7 percent to 18.80 yuan. Poly Real Estate Co added 2.3 percent to 11.24 yuan.
Retailers rose on speculation that people will spend more after China's legislature said it's raising the minimum personal income required to pay taxes from 2,000 yuan to 3,500 yuan. Zhejiang Commodities Cities Group climbed 3.4 percent to 12.71 yuan. Fujian Dongbai Group Co jumped 4 percent to 8.99 yuan.
Large banks dropped on worries about sour debt. Industrial and Commercial Bank of China lost 1.8 percent to 4.38 yuan. China Merchants Bank eased 0.6 percent to 12.94 yuan.
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