Shares drop on overseas markets

09:39, September 01, 2010      

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Chinese shares retreated Tuesday and looked set to end the month flat to slightly lower as the cloudy outlook for growth in developed economies pushed investors to the sidelines.

The Shanghai Composite Index was down 0.47 percent at the midday break with global market weakness offsetting a generally strong corporate earnings performance from Chinese companies.

Banks were all lower. China Everbright Bank Co Ltd was down 1.7 percent and China Minsheng Banking Corp Ltd down 0.9 percent. Agricultural Bank of China, the morning's most actively traded stock, slipped 0.4 percent.

Airlines were also weak, reversing robust gains made after strong first-half year earnings. China Eastern Airlines dropped 3.6 percent, while Hainan Airlines fell 3.2 percent.

Hong Kong's Hang Seng Index ended Tuesday morning down 1.08 percent at 20,513.05 with a technical support level helping to limit declines.

"The main factors are still widespread worries about a double-dip recession and questions about the sustainability of strong earnings from the Chinese mainland," said Tony Tong, head of market strategy at China Everbright.

Foxconn International Holdings led the index lower, slumping 8.3 percent after disappointing first-half results.

Foxconn plunged after the world's largest contract cell phone maker slipped deeper into the red.

Source: Global Times


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