Stocks go lower as cat­a­lysts awaited

China Daily (Hong Kong) - - BUSINESS -

BEI­JING — China’s main stock in­dexes were lit­tle changed on Mon­day, as in­vestors awaited fresh cat­a­lysts ahead of a burst of data due over the next week.

The blue-chip CSI300 in­dex fell 0.1 per­cent, to 3,653.69 points, while the Shang­hai Com­pos­ite In­dex slipped 0.2 per­cent to 3,212.63 points.

Small-caps far un­der­per­formed, with the startup board ChiNext slid­ing 1.8 per­cent, af­ter the se­cu­ri­ties reg­u­la­tor ap­proved more ini­tial public of­fer­ings over the week­end, rais­ing fears the pace of list­ings could ac­cel­er­ate.

The CSI300 in­dex fu­tures also closed mixed, with the con­tract for July 2017 up 0.1 per­cent to fin­ish at 3,634 points.

Mar­kets shrugged off China’s June in­fla­tion data, which met ex­pec­ta­tions and did lit­tle to al­ter the view that eco­nomic growth is cool­ing af­ter a solid first quar­ter. June con­sumer prices rose 1.5 per­cent from a year ear­lier.

Cap­i­tal Eco­nomics China econ­o­mist Ju­lian Evans-Pritchard said that “with slow­ing credit growth likely to weigh on eco­nomic ac­tiv­ity in com­ing quar­ters ... in­fla­tion will start fall­ing again be­fore long”.

Most econ­o­mists ex­pect growth to cool in the next few quar­ters as the key real es­tate sec­tor slows, while Bei­jing’s crack­down on debt risks raises fi­nanc­ing costs in a gen­er­ally tighter fund­ing en­vi­ron­ment.

On July 17, China will re­lease sec­ond-quar­ter gross do­mes­tic prod­uct, along with June in­dus­trial out­put, re­tail sales and Jan­uary-June fixed as­set in­vest­ment.

UBS Se­cu­ri­ties an­a­lyst Gao Ting said that in­vestor views have started to di­verge, as some see lim­ited up­side for qual­ity con­sumer stocks as val­u­a­tions touch five-year highs, while oth­ers re­main up­beat on the re-rat­ing po­ten­tial of lead­ing play­ers.

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