Mainland markets down on continued uncertainty and talk of further IPOs
Mainland markets dropped today as continued uncertainty about economic fundamentals and monetary policy weighed on recent gains. The Hong Kong market rose slightly after early falls.
The Shanghai Comprehensive Index slid 3 percent to its lowest close in six weeks and a weekly drop of 6.55 percent, the steepest in five months. Losing shares outnumbered winners by 820 to 120, while turnover on the Shanghai exchange rose to RMB145.8bn from yesterday's RMB138.2bn. The Shenzhen Composite Index dropped 3.58 percent.
The Hang Seng Index edged up 0.2 percent finishing the week 2.5 percent up. The China Enterprise Index, which tracks key mainland companies listed in Hong Kong, closing unchanged at 11,899.80.
Taiwan's Taiex Index lifted 0.5 percent.
Concerns about a forthcoming rash of IPO on the mainland added to investor concerns on talk that another major brokerage was about to get approval to list. Last week, Everbright Securities Co, (HK:0165) raised RMB10.96bn in its Shanghai offering.
Banks led the falls in Shnaghia. China CITIC bank (SH:601998) sank 4.8 percent. ICBC (SH:601398), China's biggest lender, dropped 3.2 percent. Bank of Communications (SH:601328) dropped 3.6 percent. China Merchants Bank (SH:600036, HK:3968), which said it plans to raise RMB18bn in a Shanghai and Hong Kong a rights issue, lost 2.4 percent in Shanghai and 3.4 percent in Hong Kong.
Insurers also made losses. China Life Insurance (SH:601628) fell 2 percent after announcing insurance premiums in the first seven months were down 5.8 percent from a year earlier. China Pacific Insurance (SH:601601) fell 2.1 percent. Ping An Insurance (SH:601318) dropped 2.2 percent.
China's Yanzhou Coal Mining Co (HK:1171, SH:600188) rose 2.3 percent in Hong Kong and 3.7 percent in Shanghai after announcing it will buy Australian coal miner Felix Resources Ltd (ASX:FLX).
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