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Stocks down on inflation data, weekly gain at 3%
By Lydia Chen |
October 14, 2011, Friday
|
Online Edition
Online Edition
SHARES in Shanghai fell from a three-day winning streak today after China reported its inflation still hovered high, making the government less likely to change its tightening policies.
The Shanghai Composite Index was down 0.3 percent to 2,431.38. It gained 3.06 percent for the week. However, turnover today shrank to 58.3 billion yuan (US$9.18 billion) from yesterday's 82.2 billion yuan.
The turnover contraction indicated investors were still weary of putting their money into the market given that China's trade and inflation data released this week were not really encouraging, according to Shenyin Wanguo Securities.
"Volatility will be the main theme for the next few weeks," the local brokerage house said on its website.
Gemdale Group lost 1.22 percent to 4.87 yuan. PetroChina, the country's biggest oil producer, shed 1 percent to 9.89 yuan.
China's consumer price index, a main gauge of inflation, eased slightly to 6.1 percent year-on-year in September from 6.2 percent in August, the National Bureau of Statistics said today.
On a monthly basis, consumer prices rose 0.5 percent in September, said the NBS in a statement on its website.
"Inflation is still running high although it has eased slightly from a month earlier," said Zuo Jianming, an analyst with Oriental Securities. "It is still at a level that makes it impossible for the government to loosen its tightening."
The slowing inflation growth, however, is only temporary and investors should control their exposures to stocks, China International Capital Corp cautioned in a note today.
Recent natural disasters in some areas would again push up prices, which meant inflation might bounce up again, the leading Chinese investment bank said.
Mainland shares would be "under great pressure this quarter, as inflation is high and doesn't provide much comfort for a policy easing," Gao Ting, chief China strategist at UBS AG, told Bloomberg News.
"Investors should stay cautious."
The Shanghai Composite Index was down 0.3 percent to 2,431.38. It gained 3.06 percent for the week. However, turnover today shrank to 58.3 billion yuan (US$9.18 billion) from yesterday's 82.2 billion yuan.
The turnover contraction indicated investors were still weary of putting their money into the market given that China's trade and inflation data released this week were not really encouraging, according to Shenyin Wanguo Securities.
"Volatility will be the main theme for the next few weeks," the local brokerage house said on its website.
Gemdale Group lost 1.22 percent to 4.87 yuan. PetroChina, the country's biggest oil producer, shed 1 percent to 9.89 yuan.
China's consumer price index, a main gauge of inflation, eased slightly to 6.1 percent year-on-year in September from 6.2 percent in August, the National Bureau of Statistics said today.
On a monthly basis, consumer prices rose 0.5 percent in September, said the NBS in a statement on its website.
"Inflation is still running high although it has eased slightly from a month earlier," said Zuo Jianming, an analyst with Oriental Securities. "It is still at a level that makes it impossible for the government to loosen its tightening."
The slowing inflation growth, however, is only temporary and investors should control their exposures to stocks, China International Capital Corp cautioned in a note today.
Recent natural disasters in some areas would again push up prices, which meant inflation might bounce up again, the leading Chinese investment bank said.
Mainland shares would be "under great pressure this quarter, as inflation is high and doesn't provide much comfort for a policy easing," Gao Ting, chief China strategist at UBS AG, told Bloomberg News.
"Investors should stay cautious."
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