Weak blue chips offset rising small caps
By Lydia Chen |
June 2, 2011, Thursday
|
Print Edition
Print Edition
SHANGHAI'S stock market closed almost flat yesterday, with small caps rising and heavyweights performing sluggishly.
The Shanghai Composite Index added 0.1 point to 2,743.57.
Investors speculated declines over the past month were excessive. The index lost 5.8 percent last month, the biggest decline since June 2010, on concern growth in the world's second-largest economy is slowing after the central bank raised the reserve-requirement ratio for banks 11 times and boosted interest rates four times to cool inflation. The gauge has plunged 10 percent from this year's high on April 18, a sign to some investors that the market is correcting.
"The slide may stop now," said Zhou Xuesong, an analyst at Sealand Securities Co. "Shares in the Small and Medium Enterprise Board and the ChiNext board (in Shenzhen) are also dropping much slower now. It's a sign the market is stabilizing."
SAIC Motor Corp, China's largest car maker, gained 2.4 percent to 16.94 yuan after dropping to a four-month low last week.
But a rebound will also be dependent on the performances of heavyweights such as lenders, which declined yesterday, other observers said.
The Industrial and Commercial Bank of China fell 1.75 percent to 4.48 yuan after China International Capital Corp said interest rates may rise for the third time this year in June as May's inflation may touch 5.5 percent.
The Shanghai Composite Index added 0.1 point to 2,743.57.
Investors speculated declines over the past month were excessive. The index lost 5.8 percent last month, the biggest decline since June 2010, on concern growth in the world's second-largest economy is slowing after the central bank raised the reserve-requirement ratio for banks 11 times and boosted interest rates four times to cool inflation. The gauge has plunged 10 percent from this year's high on April 18, a sign to some investors that the market is correcting.
"The slide may stop now," said Zhou Xuesong, an analyst at Sealand Securities Co. "Shares in the Small and Medium Enterprise Board and the ChiNext board (in Shenzhen) are also dropping much slower now. It's a sign the market is stabilizing."
SAIC Motor Corp, China's largest car maker, gained 2.4 percent to 16.94 yuan after dropping to a four-month low last week.
But a rebound will also be dependent on the performances of heavyweights such as lenders, which declined yesterday, other observers said.
The Industrial and Commercial Bank of China fell 1.75 percent to 4.48 yuan after China International Capital Corp said interest rates may rise for the third time this year in June as May's inflation may touch 5.5 percent.
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