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Stocks end week down despite promising CPI data
By Lydia Chen |
September 9, 2011, Friday
|
Online Edition
Online Edition
SHANGHAI stock market erased morning gains and ended slightly lower today with investors remaining uncertain whether China will ease its monetary tightening following slowing but still high inflation.
Meanwhile, concerns over local governments' debt problems also weighed on the market after a report by Xinhua news agency said about 85 percent of the local government financing vehicles of Liaoning Province has insufficient income to cover all their debt servicing payments.
The Shanghai Composite Index closed 0.05 percent lower to 2,497.75. It was down 1.2 percent on the week after August inflation data came in largely within expectations. Turnover shrank to 53.5 billion yuan (US$8.37 billion) from yesterday's 60 billion yuan.
Cement makers and developers were among the biggest losers in today's trading.
Huaxin Cement Co shed 5.47 percent to 18.15 yuan. Shanghai Shimao Co, a local developer, was down 2.33 percent to 14.24 yuan.
China Minsheng Banking Corp dropped 1.01 percent to 5.87 yuan.
Earlier a Xinhua report said county and city-level governments in the northeastern province of Liaoning have a total debt burden of 210.89 billion yuan, of which 54 percent, or nearly 114 billion yuan, would be paid back through provincial government land sales.
China's local governments have combined debt of 10.7 trillion yuan and this year and next year will be the peak time when they have to pay back the money, according to an earlier report by the National Auditor Office.
On the positive side, brokerages were the most active sector today.
Founders Securities Co hiked 3.85 percent to 6.47 yuan. CITIC Securities, the country's largest brokerage, rose 1.43 percent to 12.08 yuan.
China will soon launch exchange-traded funds linked to local indexes and the Renminbi Qualified Foreign Institutional Investor scheme, according to the People's Bank of China.
The schemes will allow Hong Kong and Chinese mainland investors to invest in each other's stock markets.
The first batch of the RQFII's 20 billion-yuan scheme allowing Hong Kong investors to buy mainland stocks "will be launched soon, and 80 percent of the amount will be invested in the mainland bond market," according to the central bank.
Meanwhile, concerns over local governments' debt problems also weighed on the market after a report by Xinhua news agency said about 85 percent of the local government financing vehicles of Liaoning Province has insufficient income to cover all their debt servicing payments.
The Shanghai Composite Index closed 0.05 percent lower to 2,497.75. It was down 1.2 percent on the week after August inflation data came in largely within expectations. Turnover shrank to 53.5 billion yuan (US$8.37 billion) from yesterday's 60 billion yuan.
Cement makers and developers were among the biggest losers in today's trading.
Huaxin Cement Co shed 5.47 percent to 18.15 yuan. Shanghai Shimao Co, a local developer, was down 2.33 percent to 14.24 yuan.
China Minsheng Banking Corp dropped 1.01 percent to 5.87 yuan.
Earlier a Xinhua report said county and city-level governments in the northeastern province of Liaoning have a total debt burden of 210.89 billion yuan, of which 54 percent, or nearly 114 billion yuan, would be paid back through provincial government land sales.
China's local governments have combined debt of 10.7 trillion yuan and this year and next year will be the peak time when they have to pay back the money, according to an earlier report by the National Auditor Office.
On the positive side, brokerages were the most active sector today.
Founders Securities Co hiked 3.85 percent to 6.47 yuan. CITIC Securities, the country's largest brokerage, rose 1.43 percent to 12.08 yuan.
China will soon launch exchange-traded funds linked to local indexes and the Renminbi Qualified Foreign Institutional Investor scheme, according to the People's Bank of China.
The schemes will allow Hong Kong and Chinese mainland investors to invest in each other's stock markets.
The first batch of the RQFII's 20 billion-yuan scheme allowing Hong Kong investors to buy mainland stocks "will be launched soon, and 80 percent of the amount will be invested in the mainland bond market," according to the central bank.
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