Shanghai stocks end weaker as tighter regulations bite

Business Monday 22/May/2017 12:36 PM
By: Times News Service
Shanghai stocks end weaker as tighter regulations bite

Shanghai: Shanghai stocks reversed earlier gains to end lower on Monday as lingering worries over economic growth and tighter regulations to curb speculative investments hurt risk appetite.
The blue-chip CSI300 index rose 0.2 per cent, to 3,411.24, while the Shanghai Composite Index lost 0.5 per cent to 3,075.68 points.
The market has been hobbled over the past few weeks by fears of renewed economic slowdown and heavy-handed regulation aimed at limiting broad financial risks.
The official think tank State Information Centre said over the weekend that China's economy will likely expand around 6.8 per cent in the second quarter of 2017, compared with 6.9 per cent in the first quarter. "Overall, China's economy will remain stable but with a slightly slowing trend," it said.
"When growth is going well, they (the Chinese government) start to withdraw a little bit of liquidity, start to raise rates a little bit," said Will Ballard, head of emerging markets and Asia Pacific equities at Aviva Investors, referring to Beijing's stepped up campaign to clean up the financial sector.
Over the weekend, China's securities regulator meted out punishment to brokerage Sealand Securities and mutual fund house Sinvo Fund Management Co for their lax internal management.
An index tracking major brokerage firms closed down 1.2 per cent at a 14-month low.
Property shares also lost ground, after more cities announced fresh restrictions on home purchases.
For the day, around 30 newly-listed stocks tumbled by the maximum allowed 10 per cent as expectations of more equity supply pressured their valuations.
China is expected to approve up to 500 IPOs to raise as much as 300 billion yuan in 2017, according to an official with the Shanghai Stock Exchange.