Stricter credit call leads index to fall
By Ding Yining and Feng Jianmin |
April 13, 2010, Tuesday
|
Print Edition
Print Edition
SHANGHAI'S stocks closed lower yesterday as property firms and banks dropped after the Chinese banking regulator urged stricter scrutiny of credit that is used to purchase land and homes.
The Shanghai Composite Index lost 0.51 percent, or 16.09 points, to 3,129.26. Turnover totaled 175 billion yuan (US$25.64 billion).
In a speech at the Boao Forum for Asia over the weekend, Liu Mingkang, chairman of the China Banking Regulatory Commission, urged all banks to increase awareness of financial risks and to use a credibility ranking system to identify possible risks of borrowers before granting loans.
Liu reiterated that lenders had the right to reject loan requests from property speculators.
Gemdale fell 4.92 percent to 12.94 yuan, the biggest drop since January 26. Apartment sales fell 27 percent to 1.2 billion yuan in March from a year earlier and first-quarter sales slumped 40 percent, the company said last Friday after the market closed.
Poly Real Estate Group Co, the nation's second-largest developer, dropped 4.29 percent to 18.76 yuan, the biggest loss since January 26. Shanghai Lujiazui Finance and Trade Zone Development Co lost 2.43 percent to 22.84 yuan.
"The market will not have strength to climb very high in the near future as investors are still concerned with a possible shift in macroeconomic policy," said Kang Chongli, an analyst at Greatwall Securities.
Banks also fell. The Industrial and Commercial Bank of China, the nation's biggest lender, lost 1.01 percent to 4.92 yuan. The Bank of Communications dropped 1.69 percent to 8.12 yuan and China Merchants Bank Co fell 1 percent to 15.88 yuan. Shanghai Pudong Development Bank shed 2.22 percent to end at 22.43 yuan.
The Shanghai Composite Index lost 0.51 percent, or 16.09 points, to 3,129.26. Turnover totaled 175 billion yuan (US$25.64 billion).
In a speech at the Boao Forum for Asia over the weekend, Liu Mingkang, chairman of the China Banking Regulatory Commission, urged all banks to increase awareness of financial risks and to use a credibility ranking system to identify possible risks of borrowers before granting loans.
Liu reiterated that lenders had the right to reject loan requests from property speculators.
Gemdale fell 4.92 percent to 12.94 yuan, the biggest drop since January 26. Apartment sales fell 27 percent to 1.2 billion yuan in March from a year earlier and first-quarter sales slumped 40 percent, the company said last Friday after the market closed.
Poly Real Estate Group Co, the nation's second-largest developer, dropped 4.29 percent to 18.76 yuan, the biggest loss since January 26. Shanghai Lujiazui Finance and Trade Zone Development Co lost 2.43 percent to 22.84 yuan.
"The market will not have strength to climb very high in the near future as investors are still concerned with a possible shift in macroeconomic policy," said Kang Chongli, an analyst at Greatwall Securities.
Banks also fell. The Industrial and Commercial Bank of China, the nation's biggest lender, lost 1.01 percent to 4.92 yuan. The Bank of Communications dropped 1.69 percent to 8.12 yuan and China Merchants Bank Co fell 1 percent to 15.88 yuan. Shanghai Pudong Development Bank shed 2.22 percent to end at 22.43 yuan.
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