Stocks News
- Shares sharply lower
Date: 23-Nov-2007 Sources: (Shenzhen Daily)
EXPECTATIONS of further measures to cool the economy and continuing concerns about high valuations led to sharp falls in China's shares Thursday.
The benchmark Shanghai Composite Index, which tracks both A and B shares, ended down 4.4 percent at 4,984.16. The Shenzhen Composite Index fell 4.6 percent to 1,253.28.
Despite its steep drop, the Shanghai index was poised to revisit the psychologically important 5,000 level Friday as a technical correction appeared due, traders said. The index has slid 17 percent since it closed at a record high of 6,092.06 Oct. 16.
'Premier Wen (Jiabao)'s recent remarks on China's need to prevent an asset bubble from forming in the share market continue to damp sentiment,'said Chen Huiqin, an analyst at Huatai Securities.
Xinhua reported Wen as saying Monday in Singapore: 'When the stock index is high, there are also calls to prevent an asset bubble, with comments that if a bubble bursts, it would hurt the Chinese economy.'
Concerns about PetroChina's high price have also begun to spill over to other stocks, traders said.
'I heard many institutional investors saying they won't even think of buying PetroChina until it drops to 30 yuan,'Chen said.
PetroChina ended 4.6 percent lower at 35.11 yuan (US$4.73). The stock has a 20 percent weighting in the Shanghai Composite Index, which it joined Monday. Every 5 percent change in the stock's price moves the index 100 points, analysts said.
Metal makers were among the worst hit Thursday, tracking an overnight fall in metal futures prices, said Essence Securities analyst Zhu Haibin.
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