Related News
Stocks plunge on rumors of international board launch
By Feng Jianmin |
November 30, 2011, Wednesday
|
Online Edition
Online Edition
SHANGHAI'S key stock index tumbled the most in more than three months as rumors surfaced that Shanghai's long-awaited international board launch was imminent.
In addition, worries that China's tight monetary policy would hurt economic growth renewed after a central bank official reiterated its prudent stance.
The Shanghai Composite Index dropped 3.27 percent to 2,333.41 points, the largest daily decline since August 8.
Concerns that the launch of the international board, which will allow multi-national companies to sell yuan-denominated shares on the Chinese mainland, will drain liquidity from the current stock market intensified after rumors that a proposal will be submitted to the securities regulator.
But officials from the Shanghai Stock Exchange dismissed the rumors as "ungrounded" shortly before the market closed.
"The rumor is a catalyst for the plunging today," said Kou Wenhong, an analyst with China Nature Asset Management Co. "But the fundamental reason is the negative outlook for macro policies, which would not support growth of the stock market. Any slight bad news will hurt the market amid low sentiment."
Xia Bin, a central bank adviser, said today that policy fine-tuning didn't mean a loosening of credit or changes in interest rates.
China should still stick to a prudent monetary policy stance, and the focus of the present policy adjustment should still be on the fiscal front as there was room for more active fiscal policies, he said.
A measure for listed banks fell 2.3 percent today, outperforming the key stock index, after Standard & Poor's downgraded many top international banks, but upgraded the Bank of China and China Construction Bank due to a change of criteria.
Bank of America Corp and its main subsidiaries are among the institutions whose ratings fell at least one notch yesterday, along with Citigroup, Goldman Sachs Group, JPMorgan Chase & Co, Morgan Stanley and Wells Fargo & Co.
No Chinese banks were included in the downgrades.
Bank of China slid 1.7 percent to 2.88 yuan. China Construction Bank dipped 0.6 percent to 4.70 yuan.
Investors are worried that China's official Purchasing Managers' Index for October, due for release tomorrow, may indicate slower expansion or even contraction. A Reuters poll revealed that a total of 13 financial institutions expected the index to range between 49 to 51.
Steelmakers dropped. Baoshan Iron & Steel Co lost 2 percent to 4.91 yuan. Wuhan Iron & Steel Co shed 2.5 percent to 3.19 yuan.
In addition, worries that China's tight monetary policy would hurt economic growth renewed after a central bank official reiterated its prudent stance.
The Shanghai Composite Index dropped 3.27 percent to 2,333.41 points, the largest daily decline since August 8.
Concerns that the launch of the international board, which will allow multi-national companies to sell yuan-denominated shares on the Chinese mainland, will drain liquidity from the current stock market intensified after rumors that a proposal will be submitted to the securities regulator.
But officials from the Shanghai Stock Exchange dismissed the rumors as "ungrounded" shortly before the market closed.
"The rumor is a catalyst for the plunging today," said Kou Wenhong, an analyst with China Nature Asset Management Co. "But the fundamental reason is the negative outlook for macro policies, which would not support growth of the stock market. Any slight bad news will hurt the market amid low sentiment."
Xia Bin, a central bank adviser, said today that policy fine-tuning didn't mean a loosening of credit or changes in interest rates.
China should still stick to a prudent monetary policy stance, and the focus of the present policy adjustment should still be on the fiscal front as there was room for more active fiscal policies, he said.
A measure for listed banks fell 2.3 percent today, outperforming the key stock index, after Standard & Poor's downgraded many top international banks, but upgraded the Bank of China and China Construction Bank due to a change of criteria.
Bank of America Corp and its main subsidiaries are among the institutions whose ratings fell at least one notch yesterday, along with Citigroup, Goldman Sachs Group, JPMorgan Chase & Co, Morgan Stanley and Wells Fargo & Co.
No Chinese banks were included in the downgrades.
Bank of China slid 1.7 percent to 2.88 yuan. China Construction Bank dipped 0.6 percent to 4.70 yuan.
Investors are worried that China's official Purchasing Managers' Index for October, due for release tomorrow, may indicate slower expansion or even contraction. A Reuters poll revealed that a total of 13 financial institutions expected the index to range between 49 to 51.
Steelmakers dropped. Baoshan Iron & Steel Co lost 2 percent to 4.91 yuan. Wuhan Iron & Steel Co shed 2.5 percent to 3.19 yuan.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
