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MAKE MONEY BLOG$~Investors in China’s main financial district are talking about the following before the start of trade today:
Stocks may be mixed today amid continuing worries about the global economy and inconsistent signs that China’s own growth will bottom out in the coming quarter as many hope.
For instance, the price of steel, a key industry subject to cyclical influence, remains weak. The Shanghai Securities News said today that Angang Steel and Wuhan Iron and Steel will cut prices for their main steel products by up to 300 yuan per ton in July. The report didn’t say by what percentage that worked out to. Shares of the two haven’t been performing like investors see a rebound ahead: they dropped by 4% and 6% this month, respectively.
In another sign of overall weakness in the equity market and economy, the China Securities News reported today that amount of capital raised through IPOs in China’s A-share markets in the first half of 2012 will be the lowest since the first half of 2009. Citing data from Wind, a domestic data vendor,103 companies raised 69 billion yuan through IPOs as of June 18. That amount was less than half of the amount raised during the same period of last year, the newspaper said.
On a more positive note, the China Securities News also noted today that commercial property prices in Beijing are continuing an uptrend. That many help shares of Beijing-focused developers such as Hong Kong-listed Soho, controlled by billionaire couple Pan Shiyi and Zhang Xin.
China’s space docking this week has caught the attention of stock traders as well as the public. Yet the best approach for traders may have been: “buy the countdown, sell the launch.” Shares in Chinese suppliers to the country’s space program were mixed yesterday after enjoying a run-up ahead of the liftoff. Shares in Shanghai-listed Shaanxi Aerospace Power Hi-Tech dropped by 2.2% to 12.94 yuan, after climbing 16% between June 6 and June 11 ahead of Shenzhou IX’s Saturday’s launch. (See related story here.)
Among Chinese retail stocks, Hong Kong-traded shares in Huiyin Household Appliances, a medium-sized Chinese electrical appliance retail chain, fell 5.2% yesterday after the company posted a warning about the outlook for its earnings. Net profit for the first half “is expected to be significantly lower than that of the corresponding period in 2011,” the company said in a statement after the end of stock trading on Friday. Traditional retailers like Huayin are battling a combination of slower-than-expected growth and competition from e-tailers. (See full story here.)
And in other news involving Hong Kong-traded Chinese shares, Weiqiao Textile of Shandong, the world’s largest cotton textile manufacturer, lost 1.3% in trading in Hong Kong yesterday after the company said on Friday it expects “a significant decrease” in profits for the six months to June 30 compared with a year earlier. The company is backed by the family of Zhang Shiping, who ranked No. 14 on the 2011 Forbes China Rich List with wealth of $4.2 billion. (See related story here.)
– with Maggie Chen
source: forbes.com
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