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Shanghai stocks mixed after IMF cut China forecast
By Ye Zhen |
October 10, 2012, Wednesday
|
Online Edition
Online Edition
SHANGHAI stocks wavered today amid growing uncertainty after the International Monetary Fund trimmed its forecast for China's economic growth while the central government pledged further measures to boost market sentiment.
The benchmark Shanghai Composite Index added 0.22 percent, or 4.71 points, to close at 2,119.94 points. Turnover was 60.5 billion yuan (US$9.6 billion) for the day.
The IMF yesterday lowered its forecasts for China's economic growth to 7.8 percent this year and 8.2 percent next year, down from 8 percent and 8.5 percent respectively.
"In the short term, a further escalation of the euro area crisis and failure to address the US fiscal cliff are the main external risks," the IMF said.
The Chinese government is trying to lift the investor sentiment by encouraging share buyback.
Deng Zhixiong, an official at the State-owned Assets Supervision and Administration Commission, said the government will encourage state-owned enterprises and listed companies to increase their shareholdings and buy back stocks through secondary market.
Companies buying back stocks will demonstrate their confidence in market outlook and show that they have sufficient cash flows, analysts said.
Automakers gained on expectation the government will provide auto purchasing subsidies to rural homes. Beiqi Foton Motor Co rose 2.9 percent to 6.39 yuan. Anhui Jianghuai Automobile Co added 0.9 percent to 5.35 yuan.
Cement producers declined the most. Anhui Conch Cement Co, China's biggest cement producer, shed 0.4 percent to 16 yuan. Zhejiang Jianfeng Group Co lost 0.2 percent to 10.52 yuan. Gansu Qilianshan Cement Group Co dropped 1.2 percent to 11.73 yuan.
The benchmark Shanghai Composite Index added 0.22 percent, or 4.71 points, to close at 2,119.94 points. Turnover was 60.5 billion yuan (US$9.6 billion) for the day.
The IMF yesterday lowered its forecasts for China's economic growth to 7.8 percent this year and 8.2 percent next year, down from 8 percent and 8.5 percent respectively.
"In the short term, a further escalation of the euro area crisis and failure to address the US fiscal cliff are the main external risks," the IMF said.
The Chinese government is trying to lift the investor sentiment by encouraging share buyback.
Deng Zhixiong, an official at the State-owned Assets Supervision and Administration Commission, said the government will encourage state-owned enterprises and listed companies to increase their shareholdings and buy back stocks through secondary market.
Companies buying back stocks will demonstrate their confidence in market outlook and show that they have sufficient cash flows, analysts said.
Automakers gained on expectation the government will provide auto purchasing subsidies to rural homes. Beiqi Foton Motor Co rose 2.9 percent to 6.39 yuan. Anhui Jianghuai Automobile Co added 0.9 percent to 5.35 yuan.
Cement producers declined the most. Anhui Conch Cement Co, China's biggest cement producer, shed 0.4 percent to 16 yuan. Zhejiang Jianfeng Group Co lost 0.2 percent to 10.52 yuan. Gansu Qilianshan Cement Group Co dropped 1.2 percent to 11.73 yuan.
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