Stocks fall on steel industry downgrade

10:08, June 18, 2010      

Email | Print | Subscribe | Comments | Forum 

China's stocks fell on Shenyin & Wanguo Securities Co's downgrade of the steel industry and concern healthcare companies may be overvalued given their earnings outlook.

"A slowing of economic and corporate earnings growth in the third quarter looks certain as a result of tightening measures," said Zheng Tuo, president of Shanghai Good Hope Equity Investment Management Co. "Some of the slowdown may have already been priced into equities and there's a big possibility of a double-dip for the economy."

The Shanghai Composite Index dropped 9.70, or 0.4 percent, to 2560.25 at the close. The CSI 300 Index lost 0.6 percent to 2742.73.

The Shanghai gauge has dropped 22 percent this year on concern government measures to rein in housing prices and the European crisis will damp economic growth.

China's steelmaking industry was lowered to "neutral" from "overweight" by Shenyin & Wanguo analyst Zhao Xiange. Major steelmakers will have "slim" profit margins in the third quarter and the outlook for iron ore negotiations isn't optimistic, Zhao said in a report on Thursday.

Hebei Iron & Steel Co fell 1.2 percent to 4.02 yuan. Maanshan Iron & Steel Co slid 1.2 percent to 3.42 yuan.

Jiangsu Hengrui Medicine paced declines for drugmakers, sliding 8 percent to 45.09 yuan and trimming its gain to 3.1 percent this year. Harbin Pharmaceutical Group Co tumbled 8.9 percent to 20.23 yuan, its biggest loss since September 2008.

A measure tracking health-care stocks slid 5.8 percent on Thursday, the most among the 10 industry groups of the CSI 300. It had advanced 9.3 percent in 2010 as of the end of last week.

Hang Seng gains

The Hang Seng Index rose 0.4 percent to 20138.40 at the close of trading. It increased 3.9 percent in the past seven trading days.

The Hang Seng China Enterprises Index of Chinese companies' H-shares advanced 0.2 percent to 11583.50.

Source:China Daily


  • Do you have anything to say?


Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • Giant red lantern lights up in Tiananmen Square to celebrate the coming National Day on Oct. 1. (Xinhua/Li Xin)
  • A ceremony is held in Taipei, southeast China's Taiwan, on Sept. 28, 2011, to commemorate the 2,562nd birthday of Confucius (551-479 BC), a Chinese thinker, educationist and philosopher. (Xinhua/Wu Ching-teng)
  • The world's first Boeing 787 Dreamliner for delivery arrives at Haneda airport in Tokyo, capital of Japan, on Sept. 28, 2011. The Boeing 787 Dreamliner, whose buyer is All Nippon Airways (ANA), will implement a flight of ANA on Oct. 26 from Tokyo's Narita Airport to Hong Kong in south China. (Xinhua/Ji Chunpeng)
  • A Libyan National Transitional Council (NTC) fighter shows what is believed to be human jawbone found inside a mass grave near Abu Salim prison in Tripoli, Libya, Spet. 27, 2011. The NTC on Sunday said they had found a mass grave containing the bodies of 1,270 people killed by Gaddafi's security forces in a 1996 massacre at Abu Salim prison in southern Tripoli. (Xinhua/Li Muzi)
  • Rescue workers and local residents search for survivors after a building collapsed in old Delhi, India, Sept. 27, 2011. At least 10 people were killed and 35 injured when an old three-storey building collapsed. More than a dozen people are still feared trapped under the debris, police said. (Xinhua/Partha Sarkar)
  • A visitor has flying experience in the windmill castle of Jinshitan National Holiday resort in Dalian, northeast China's Liaoning Province, Sept. 27, 2011. The castle is a 23-meter-high building with 21 meters in diameter. The castle uses wind tunnel to make objects floating in the air. It is the first indoor stadium in China, which enables people to have flying experience. (Xinhua/Zhang Chunlei)
Hot Forum Discussion