China Stocks Drop Most in Week
Published Thursday, 16 February 2012 16:16 | Written by Yomna Yasser
China’s stocks fell, driving the benchmark index’s biggest loss in a week, as a slump in foreign direct investment and delays in a Greek aid package boosted concerns the nation’s economic slowdown will accelerate.
Jiangxi Copper Co. (600362) and Aluminum Corp. of China Ltd. led declines for metal producers after European officials postponed a decision on a 130-billion euro ($169 billion) bailout for Greece. Cosco Shipping Co. (600428), a unit of China’s biggest shipping company, slid 2.9 percent after the commerce ministry said the outlook for foreign investment and trade is “grim.” Huayi Brothers Media Corp. (300027) paced gains for media stocks as the government pledged to support the “culture” industry.
“The fundamentals of the economy aren’t good and monetary policy will still be kept relatively tight this year,” said Wang Zheng, Shanghai-based chief investment officer at Jingxi Investment Management Co., which manages about $120 million. “But investors anticipate the government will have measures to support equities. Stocks will be volatile for the moment.”
The Shanghai Composite Index (SHCOMP) slid 9.84 points, or 0.4 percent, to 2,356.86 at the close, the most since Feb. 7. The CSI 300 Index lost 0.5 percent to 2,536.07. The Bloomberg China- US 55 Index, the measure of the most-traded U.S.-listed Chinese companies, added 0.9 percent yesterday.
The Shanghai Composite has rebounded 9.7 percent from a Jan. 5 low on speculation the central bank will cut lenders’ reserve-requirement ratios to spur growth. It announced a reduction in reserve ratios on Nov. 30, the first since 2008, after boosting them and interest rates last year to cool inflation.