Domestic stocks slid for a second day today amid concerns higher
fuel prices may increase corporate costs and constrain the
country's booming economy.
The Shanghai Composite Index, which tracks both yuan-denominated
A shares and hard-currency B shares, shed 2.31 percent, or 136.48
points, to close at 5,777.81 this morning.
Among the stocks on the Shanghai Composite Index, 178 rose, 589
fell and 79 were unchanged.
Airlines and auto makers saw their stocks slide for anther
trading day after the country unexpectedly increased fuel prices by
as much as 10 percent yesterday in what the government said was an
"urgent step'' to help the nation's oil refiners cover rising costs
as crude oil surged to record-high levels.
China faces pressure maintaining power supplies in some regions,
the National Development and Reform Commission, the nation's top
planning agency, said in Beijing today. Accelerating raw-material
costs are boosting inflation pressures, it said.
Air China, the world's biggest airline by market value, lost
6.37 percent, or 1.34 yuan (18 US cents), to close at 19.68 yuan at
3:00pm.
China Eastern, the nation's third-largest carrier, declined 4.06
percent, or 0.59 yuan, to 13.94 yuan. China Southern, the nation's
biggest carrier, dropped 5.32 percent, or 1.15 yuan, to 20.46
yuan.
SAIC Motor Co, China's largest car maker, fell 6.34 percent, or
1.57 yuan, to 23.21 yuan. Chongqing Changan Automobile Co, the
Chinese partner of Ford Motor Co and Mazda Motor Corp, lost 6.85
percent, or 1.10 yuan, to 14.95 yuan.
Non-ferrous metals also fell today.
Aluminum Corp of China, the country's largest producer of the
light metal, fell to a five-week low on speculation rising
electricity prices will reduce profits. The stock was down 3.08
percent, or 1.48 yuan, to 46.58 yuan.
The company's chief financial officer said yesterday that
China's aluminum producers may pay as much as fivefold more for
electricity to fire their plants as rivals by year end, slowing
expansion and increasing imports.
China will cancel electricity price discounts for the aluminum
industry to curb growth in power-intensive industries, the NDRC
said October 11.
But the higher gasoline prices helped oil-related stocks to a
second strong trading day.
China Petroleum, also known as Sinopec, rose 2.85 percent, or
0.79 yuan, to 28.49 yuan. Sinopec Shanghai Petrochemical Co,
China's largest maker of ethylene, added 1.07 percent, or 0.21
yuan, to 19.85 yuan.
Elsewhere, Citic Securities, Asia's largest brokerage by market
value, whose shares were suspended since October 22, climbed the
daily cap of 10 percent, or 10.59 yuan, to a record 116.52 yuan.
During the trading halt, Citic Securities also reported a more than
eightfold increase in third-quarter profit.
(Shanghai Daily November 2, 2007)
