Some light from technology rally

CHINESE stocks rose yesterday, paring the benchmark index’s biggest quarterly loss since 2008, as a rally for technology companies overshadowed a report showing industrial companies’ profits dropping the most in at least four years.

The Shanghai composite index climbed 0.3 percent to 3 100.76 points at the close, erasing a loss of as much as 1.6 percent. About four stocks advanced for each one that fell as turnover plunged before the start of a week-long holiday from this week.

Wangsu Science & Technology jumped 10 percent. Hong Kong’s stock market was shut for the mid-autumn festival.

The Shanghai gauge has fallen 28 percent this quarter, heading for the worst threemonth period since March 2008, as leveraged investors fled the stock market amid concerns valuations weren’t justified amid a weakening economy.

Trading volumes in Shanghai plunged 55 percent below the 30-day average before the National Day holiday starting on October 1. – Bloomberg Hong Kong. “The message to policymakers should be perfectly clear: ease monetary policy drastically to get in line with the rest of the zero-interest rate world.”

The Shanghai composite index reversed earlier losses to close 0.3 percent higher at 3 100.76, paring its loss from a June 12 peak to 40 percent.

Contributions from investment returns fell amid China’s stock market rout, while exchange-rate losses rose “noticeably” due to yuan volatility, pushing the companies’ financial costs up by 23.9 percent last month from a year earlier, compared with a 3 percent drop in July, according to the bureau.

Premier Li Keqiang has responded to the slowest growth in a quarter of a century with policy easing measures, including five interest rate cuts since November, reductions in the amount of deposits banks must hold as reserves, a surprise currency devaluation last month and increased fiscal support.