Shares lose 1.24% on tumble by coal firms
Shares in Shanghai lost 1.24 percent yesterday as the key index fell when coal companies slumped on market speculation that a proposed tax reform will hurt earnings, as well concerns of a possible interest-rate rise at the weekend.
The Shanghai Composite Index, which tracks yuan-denominated A shares and hard currency B-shares, tumbled 33.64 points to 2,669.89 at the close. The barometer has retreated 78.54 points, or 2.86 percent, this week. Turnover dropped to 62 billion yuan (US$9.1 billion).
Blue chips led the decline, with coal companies diving after Shanghai-based National Business Daily reported China may increase the resource tax on coal production at the weekend.
China Shenhua Energy Co, Asia’s largest coal producer, slumped 8.13 percent to 31.96 yuan. Shanxi Xishan Coal & Electricity Power Co tumbled 9.48 percent to 42 yuan.
China Petroleum & Chemical Corp, known as Sinopec, lost 3.19 percent to 9.42 yuan (US$1.37) while PetroChina Co shed 2.24 percent to 14.38 yuan.
Ping An Insurance (Group) Co was off 0.94 percent to 40.17 yuan yesterday after tumbling 18 percent this week on concerns it’s being investigated for tax irregularities.
Going in the opposite direction, Industrial & Commercial Bank of China Ltd, the world’s biggest lender by market value, surged 1.05 percent to 4.80 yuan after it said first-half profit is expected to rise by more than 50 percent.
However, analysts said the bearish market, hurt by a gloomy economic outlook and record high oil prices, still has an opportunity to recover.
“Authorities have been trying to restore confidence in the market through headline stories carried in major securities newspapers in an attempt to stabilize the market,” Qi Lu Securities Co Ltd said yesterday. “The market’s recovery will be helped by the coming Olympic Games which is said to benefit economic development.”
Tags: coal, Shanghai-Composite-Index, Share