Wen's property price remark pulls index down
By Hu Xiaocen |
March 15, 2012, Thursday
|
Print Edition
Print Edition
SHANGHAI'S stock market plunged by the most in more than three months yesterday after property developers tumbled following Premier Wen Jiabao's comment that home prices are still "far from reasonable."
The Shanghai Composite Index fell 2.6 percent to 2,391.23, the biggest loss in percentage since November 30.
"Now I can clearly tell you that housing prices are far from reasonable. Therefore, the controls cannot be relaxed," Wen said at a press conference yesterday.
Property developers dived after Wen's remarks. Poly Real Estate, China's second-biggest listed developer, slumped 3 percent to 11 yuan (US$1.74). Gemdale Corp, the fourth largest, slumped 5.9 percent to 5.88 yuan. Xian Gree Real Estate lost 2.8 percent to 6.19 yuan.
He Xu, analyst at Goldstate Securities, said yesterday that the benchmark index would not likely rebound to 2,500 points this month and he was not optimistic about the stock market in April.
But Julius Baer, a private bank based in Zurich, Switzerland, was positive on China's stock market in 2012.
"We expect a rally of China's A shares. The Shanghai Composite Index may test 2,600 to 2,700 points this year," Alan Lam, the bank's China equity analyst, said yesterday.
"We see A shares outperforming Hong Kong equities in the medium term on attractive valuations, a possible rebound in money supply, easing capital costs and sensitivity to policy changes," Lam said.
The Shanghai Composite Index fell 2.6 percent to 2,391.23, the biggest loss in percentage since November 30.
"Now I can clearly tell you that housing prices are far from reasonable. Therefore, the controls cannot be relaxed," Wen said at a press conference yesterday.
Property developers dived after Wen's remarks. Poly Real Estate, China's second-biggest listed developer, slumped 3 percent to 11 yuan (US$1.74). Gemdale Corp, the fourth largest, slumped 5.9 percent to 5.88 yuan. Xian Gree Real Estate lost 2.8 percent to 6.19 yuan.
He Xu, analyst at Goldstate Securities, said yesterday that the benchmark index would not likely rebound to 2,500 points this month and he was not optimistic about the stock market in April.
But Julius Baer, a private bank based in Zurich, Switzerland, was positive on China's stock market in 2012.
"We expect a rally of China's A shares. The Shanghai Composite Index may test 2,600 to 2,700 points this year," Alan Lam, the bank's China equity analyst, said yesterday.
"We see A shares outperforming Hong Kong equities in the medium term on attractive valuations, a possible rebound in money supply, easing capital costs and sensitivity to policy changes," Lam said.
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