Tight liquidity fears damp index
By Feng Jianmin |
October 21, 2011, Friday
|
Print Edition
Print Edition
SHANGHAI'S key stock index yesterday fell to the lowest in more than two years, led by metal producers and banks on concerns over tight liquidity and slower growth for the Chinese economy.
The Shanghai Composite Index lost 1.9 percent to 2,331.37 points, the lowest close since March 25, 2009.
Wen Lijun, an analyst with Nanjing Securities, said that money supply in the domestic market is still tight and the government's stringent monetary policies will not be eased in the short term.
China's total financing shrank in the first three quarters from a year ago on the tighter money policies, the People's Bank of China said in a statement yesterday.
Metal producers dropped after metal prices tumbled in Shanghai on concerns that slower economic growth will dampen demand.
Jiangxi Copper Co, China's biggest producer of the metal, shed 4.4 percent to 25.20 yuan. Copper futures for January delivery slid 6 percent to 50,950 yuan (US$7,979) per ton.
Aluminum Corp of China trailed 2.8 percent to 7.97 yuan. Aluminum inventories in China, the largest user of the metal, rebounded 30 percent in three weeks on slower trading, said a report by Guangzhou KT Commodity Information and Consulting Co.
Property developers and banks also fell after the China Banking Regulatory Commission said that lenders could withstand a 40 percent drop in home prices, affirming speculation the government will not loosen its curbs on the property market.
The Shanghai Composite Index lost 1.9 percent to 2,331.37 points, the lowest close since March 25, 2009.
Wen Lijun, an analyst with Nanjing Securities, said that money supply in the domestic market is still tight and the government's stringent monetary policies will not be eased in the short term.
China's total financing shrank in the first three quarters from a year ago on the tighter money policies, the People's Bank of China said in a statement yesterday.
Metal producers dropped after metal prices tumbled in Shanghai on concerns that slower economic growth will dampen demand.
Jiangxi Copper Co, China's biggest producer of the metal, shed 4.4 percent to 25.20 yuan. Copper futures for January delivery slid 6 percent to 50,950 yuan (US$7,979) per ton.
Aluminum Corp of China trailed 2.8 percent to 7.97 yuan. Aluminum inventories in China, the largest user of the metal, rebounded 30 percent in three weeks on slower trading, said a report by Guangzhou KT Commodity Information and Consulting Co.
Property developers and banks also fell after the China Banking Regulatory Commission said that lenders could withstand a 40 percent drop in home prices, affirming speculation the government will not loosen its curbs on the property market.
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