Stocks step back fromrecent ‘reform’ rally

China’s main indexes edged lower on Tuesday, as investors took profits after a recent strong rally fueled by reforms hopes.

The blue-chip CSI300 index fell 0.2 percent, to 3,358.27 points, while the Shanghai Composite Index lost 0.3 percent to 3,161.67 points.

The broad market losses were limited as participants continued to seek stocks that were tied to the State-owned enterprises, mixed-ownership reform theme.

For the day, the best gainer was airliners, which soared after reports that China Southern Air Holding Company planned to push mixed-ownership reform by introducing strategic investors, in particular internet companies.

Investors appeared to shrug off data showing producer prices surged the most in more than five years in December, as prices of coal and other raw materials soared.

The pickup in prices reinforced views that the world’s second-biggest economy is on steadier footing heading into the new year, underpinned by stronger factory activity and domestic demand which are being driven by a lending and construction boom.

Sector performances were mixed. The gains were led by transport and material shares, while infrastructure and utilities equites lagged.

the decline in the benchmark Shanghai Composite Index on Tuesday