China stocks rise but post worst quarter since 2008
SHANGHAI, Sept 30 (Reuters) - China stocks made modest gains on Wednesday but posted their worst quarterly loss since early 2008, retreating almost 30 percent as concerns grew that the slowing economy was crushing company profits.
Auto shares surged after Beijing announced fresh support for struggling carmakers, supporting the main indexes. But trading volume in Shanghai shrank to a 10-month low ahead of week-long national holidays beginning on Thursday.
The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 0.8 percent to 3,202.95 points, while the Shanghai Composite Index gained 0.5 percent to 3,052.78.
But for the quarter, both indexes lost roughly 29 percent, the worst showing since the depths of the global financial crisis and raising fresh questions about the effectiveness of Beijing's massive market rescue efforts since stocks began to collapse in mid-June.
Reflecting strong pessimism that share prices will recover any time soon, Chinese mutual fund managers cut suggested equity exposure for the coming three months to a record low of 65.0 percent, a monthly Reuters poll showed.
Risk appetite has been dampened by the sharp and wild price slide in recent months, Beijing's unexpected currency devaluation last month and fears that the economy could be cooling more rapidly than expected earlier, according to the poll.
Profits earned by Chinese industrial companies declined at the sharpest rate in four years in August as costs kept rising and product prices kept falling, data showed earlier this week.
Profits of industrial companies dropped 8.8 percent in August from a year earlier.
Wednesday's rally was ignited by the auto sector, with shares of Chinese carmakers including Changan Auto, Great Wall Motor and SAIC Motor surging after Beijing halved the sales tax on small-engine cars to aid the struggling sector. Continuación...