Stocks on mainland fall most in nearly a month
SHANGHAI - Stocks on the Chinese mainland fell, sending the benchmark index to its biggest loss in almost a month, after the economy grew at the slowest pace in two years and Germany damped expectations for a fast resolution to Europe's debt crisis.
PetroChina Co and Jiangxi Copper Co, the nation's largest oil and copper producers, led declines by commodity producers after gross domestic product expanded less than analysts' estimates. China Vanke Co, the biggest developer, slid 2 percent after home prices gained in fewer than half of 70 cities as sales eased. Sinohydro Group Ltd, the nation's largest builder of hydroelectric dams, jumped 17 percent in China's biggest initial public offering this year.
"The economic growth number wasn't too bad, but the European crisis is still a hangover for the stock market," said Wei Wei, an analyst at West China Securities Co in Shanghai. "A lack of cash also caps gains in stocks."
The Shanghai Composite Index slumped 57 points, or 2.3 percent, to 2383.49 at the close, the most since Sept 22. The CSI 300 Index declined 2.8 percent to 2592.21. Stock markets across Asia dropped on Tuesday after German Chancellor Angela Merkel's office knocked down what it called "dreams" that the Oct 23 summit will be the last word in taming the crisis.
The Shanghai index has tumbled 15 percent this year, driving down estimated price earnings to 10.98 times, compared with the record low of 10.8 times set on Oct. 10, according to data compiled by Bloomberg. China has raised interest rates three times in 2011 and ordered lenders to set aside a bigger portion of their deposits to curb inflation that's near a three-year high.
Gauges of energy and material stocks in the CSI 300 slid more than 3 percent, the most among the 10 industry groups. PetroChina fell 1.9 percent to 9.73 yuan($1.53). Jiangxi Copper lost 4.3 percent to 26.40 yuan. Anhui Conch Cement Co, the largest producer of cement, dropped 5.4 percent to 18.34 yuan.
Bloomberg News
(China Daily 10/19/2011 page13)
