Steel mills bend to send local shares 0.3% lower
By Ding Yining |
August 1, 2012, Wednesday
|
Print Edition
Print Edition
SHANGHAI shares dropped yesterday to the lowest level in more than three years after steel mills reported a 96 percent drop in combined first-half profit.
The Shanghai Composite Index dipped 0.3 percent to 2,103.63 points, its lowest closing level since March 2009. The index lost 5.47 percent in July.
"Investors' sentiment will remain rather low in the near future," said Caitong Securities analyst Chen Jian.
Steel makers were among the losers after the slowing economy hurt manufacturers earnings. The China Iron and Steel Association yesterday said first-half profit at domestic steel makers dropped 96 percent from a year ago to 2.38 billion yuan. The association's director Zhu Jimin said high raw material costs and weak demand squeezed the profit of most steel mills.
Baoshan Iron and Steel Co declined 0.5 percent to 4.20 yuan (66 US cents). Angang Steel Co fell 0.5 percent to 3.66 yuan.
The railway sector gained after the Ministry of Railways on Monday announced it will increase spending on infrastructure. China Railway Erju Co rose 2.97 percent to 6.59 yuan. Jinxi Axle Co was up 1.57 percent to 10.38 yuan.
China will add a further 64 billion yuan in railway construction spending to a total of 580 billion yuan this year.
The Shanghai Composite Index dipped 0.3 percent to 2,103.63 points, its lowest closing level since March 2009. The index lost 5.47 percent in July.
"Investors' sentiment will remain rather low in the near future," said Caitong Securities analyst Chen Jian.
Steel makers were among the losers after the slowing economy hurt manufacturers earnings. The China Iron and Steel Association yesterday said first-half profit at domestic steel makers dropped 96 percent from a year ago to 2.38 billion yuan. The association's director Zhu Jimin said high raw material costs and weak demand squeezed the profit of most steel mills.
Baoshan Iron and Steel Co declined 0.5 percent to 4.20 yuan (66 US cents). Angang Steel Co fell 0.5 percent to 3.66 yuan.
The railway sector gained after the Ministry of Railways on Monday announced it will increase spending on infrastructure. China Railway Erju Co rose 2.97 percent to 6.59 yuan. Jinxi Axle Co was up 1.57 percent to 10.38 yuan.
China will add a further 64 billion yuan in railway construction spending to a total of 580 billion yuan this year.
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