|
China's shares fell yesterday as profit-taking took the steam out of a rebound which saw indices jump to two-month highs, brokers said.
Shanghai's B share index fell 1.17 percent to 125.995 points after rising 6.76 percent on Tuesday on rumours of impending government policies aimed at boosting long-depressed markets.
Shenzhen's B index fell 1.45 percent to 202.83 after surging 5.65 percent on Tuesday. Hard currency B shares are open to foreign and Chinese investors.
The decline dashed market hopes yesterday morning that the rally could be sustained in the medium term, but some remained optimistic.
"It was no surprise that some profit-taking emerged today after share prices had surged in the recent rebound," said analyst Dai Yizhong of Guotai Jun'an Securities.
"The fall today will not affect our forecast that the markets will see a medium-term rally as the rebound has helped improve investor confidence to a great extent," he said.
Chang'an Automobile Co, China's biggest minivan maker, led yesterday's B share decliners with a fall of 2.81 per cent to HK$3.81 (US$0.49). It had climbed 14 per cent since January 2, the first trading session this year.
Before yesterday's fall, the benchmark Shanghai composite index, which includes domestic A shares, had risen 11 per cent this month.
It fell 40 percent in the past 19 months due to negative factors ranging from poor earnings to frequent initial public offerings.
Investors began to talk about possible official measures to boost the markets after newly appointed top securities regulator Shang Fulin toured exchanges recently, but there have been few details on what the government might do.
Brokerages may be allowed to use shares as collateral for loans. The China Securities Regulatory Commission declined to comment.
Despite yesterday's overall fall, punters continued buying market heavyweights and loss-making companies on persistent hopes of government support, brokers said.
Yesterday's star performer was China United Telecommunications Corp, the second-largest capitalized company on mainland exchanges, which closed up its 10 percent daily limit for a second session at 3.38 yuan (US$0.41).
Unicom, which has listed A shares in Shanghai open to Chinese and select foreign investors, was the third-lowest priced counter on A share markets after the gain. It was previously the lowest.
On B share markets, property developer Jiangsu Xincheng Co, which lost money in 2000 and 2001, was the biggest gainer in Shanghai, rising 1.07 percent to US$0.565. The company has yet to report its 2002 results.
Shanghai's A share index closed down 0.46 percent at 1,525.14 points and its Shenzhen counterpart was down 0.72 percent at 438.88.
China's yuan weakened two notches to a still strong 8.2770 to the US dollar yesterday, with dealers expecting the Chinese currency to stay firm before the Lunar New Year holidays in February.
Yuan trading was confined to a tight range with the intraday low at 8.2771 and high at 8.2768 - Tuesday's close. Turnover was heavy at US$890 million, up from US$690 million on Tuesday.
The yuan, which is not fully convertible on the capital account, was expected to remain solid due to active exports before the Lunar New Year break from February 1-7, dealers said.
"Activity is seen to be quite brisk before the holidays because of strong exports and some exporters plan to square off their books. That will support the yuan," said a domestic bank dealer in Beijing.
(China Daily January 16, 2002)
|
