August 22, 2016 / 5:01 AM / 2 years ago

China stocks edge down on profit-taking, Hong Kong eases

* SSEC -0.6 pct, CSI300 -0.6 pct, HSI -0.3 pct

* China’s infrastructure, transport shares fall on profit-taking

* Property shares outperform, Vanke supports

BEIJING, Aug 22 (Reuters) - China stocks were dragged by infrastructure and transportation shares as some investors took profit on Monday, but the property market stayed buoyant, while Hong Kong shares eased slightly.

The CSI300 index, which tracks the largest listed companies trading in Shanghai and Shenzhen, fell 0.6 percent, to 3,343.61 points at the end of the morning session, while the Shanghai Composite Index lost 0.6 percent, to 3,088.37 points.

Analysts said they expected further capital inflows to boost sentiment over the long run, supported by broader access to China’s stock markets.

Zhang Qi, senior analyst at Haitong Securities in Shanghai, said trading was muted on Monday but he expects the upcoming launch of the Shenzhen-Hong Kong stock connect to attract some foreign capital into companies listed in Shenzhen.

“The market is quite stable and bland today despite some slight falls in the indexes and trading volumes. We have seen such a trend over the past few days and (I expect to see the trend) extend in the near term,” Zhang said, adding that blue-chip stocks were also trading narrowly.

China CSI300 stock index futures for September fell 0.7 percent, to 3,311.2, 32.41 points below the current value of the underlying index.

Infrastructure and transportation sectors were among the top losers as of midday with sub-indexes falling 0.89 percent and 0.85 percent, respectively. The two sectors rose last week as state media reported that investment by Chinese firms into “One Belt, One Road” countries along the new Silk Road trade route has already reached $51.1 billion.

The real estate sector outperformed the market, with the subindex rising 0.52 percent, led by China Vanke Co . The index has risen more than 22 percent so far this month.

China Vanke, the country’s biggest home builder, said on Sunday its first-half profit rose 10 percent, even though business has been bit a high-profile battle for control of the firm.

By the lunch break, Vanke’s Shenzhen-listed shares gained 1.34 percent. Its Hong Kong-listed shares rose 0.74 percent, while it gained more than 2 percent at one point during morning trade.

In Hong Kong, the Hang Seng index dropped 0.3 percent, to 22,860.96 points. The Hong Kong China Enterprises Index lost 0.8 percent, to 9,531.94.

Total volume of A shares traded in Shanghai was 10.60 billion shares, while Shenzhen volume was 12.50 billion shares.

Reporting by Winni Zhou and Nicholas Heath; Editing by Jacqueline Wong

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