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Shanghai stocks down 2% on IMF downgrade report
By Feng Jianmin |
February 7, 2012, Tuesday
|
Online Edition
Online Edition
SHANGHAI'S key stock index dropped nearly 2 percent in the morning session after the International Monetary Fund downgraded China's growth projection for 2012 and warned that downturn in Europe could cut China's growth by half.
The benchmark Shanghai Composite Index fell 1.93 percent at midday to close at 2,286.17 points.
The IMF said in a report released yesterday that China needs to reduce its reliance on external demand to lessen the impact of a possible worsening debt crisis in Europe. It lowered China's economic growth projection for 2012 from 9 percent to 8.2 percent, adding that a sharp downturn in Europe could further cut the growth rate by as much as 4 percentage points.
Developers slumped as the report said the real estate sector was beginning to "deflate" with price growth slowing and transactions dwindling. Gemdale Corp dropped 3 percent to 5.07 yuan. Poly Real Estate Co shed 4.1 percent to 10.02 yuan.
Brokerages led the decliners after companies reported losses in January. Four out of 11 brokerages that have released financial statements as of yesterday have reported losses. Data with iFinD showed the revenue from brokerages' initial public offerings has shrunk 90 percent month-on-month.
Soochow Securities Co slid 3.5 percent to 6.55 yuan after reporting losses of 16.1 million yuan in January. Haitong Securities Co declined 3.3 percent even though it reported 120 billion yuan in profit last month.
The benchmark Shanghai Composite Index fell 1.93 percent at midday to close at 2,286.17 points.
The IMF said in a report released yesterday that China needs to reduce its reliance on external demand to lessen the impact of a possible worsening debt crisis in Europe. It lowered China's economic growth projection for 2012 from 9 percent to 8.2 percent, adding that a sharp downturn in Europe could further cut the growth rate by as much as 4 percentage points.
Developers slumped as the report said the real estate sector was beginning to "deflate" with price growth slowing and transactions dwindling. Gemdale Corp dropped 3 percent to 5.07 yuan. Poly Real Estate Co shed 4.1 percent to 10.02 yuan.
Brokerages led the decliners after companies reported losses in January. Four out of 11 brokerages that have released financial statements as of yesterday have reported losses. Data with iFinD showed the revenue from brokerages' initial public offerings has shrunk 90 percent month-on-month.
Soochow Securities Co slid 3.5 percent to 6.55 yuan after reporting losses of 16.1 million yuan in January. Haitong Securities Co declined 3.3 percent even though it reported 120 billion yuan in profit last month.
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