July 27, 2017 / 5:08 AM / a year ago

China stocks slip despite solid June industrial profits; Hong Kong up

* SSEC -0.3 pct, CSI300 -0.3 pct, HSI +0.5 pct

* Analysts ignore industrial profits, resource shares down

* Hong Kong poised for 4th straight day of gains

SHANGHAI, July 27 (Reuters) - China stocks slipped on Thursday morning, dragged down by losses in resource firms, despite data showing the world’s second-largest economy remains on a solid footing.

The CSI300 index was down 0.3 percent, to 3,693.45 points at the end of the morning, and the Shanghai Composite Index also lost 0.3 percent, to 3,237.04 points.

Earnings for China’s industrial firms surged 19.1 percent in June from a year earlier, accelerating from May.

Analysts shrugged off the industrial profits data as in line with recent solid data that had been priced in earlier to rallying resource and cyclical shares.

On Thursday, prices of coal and other resource stocks saw corrections.

“While there was a sharp correction in resources and other cyclical shares that had seen a strong rally in the past months, the rotation into firms with solid fundamentals and low valuations is expected to last for a long time,” said Xu Wei, analyst with Hongxin Securities.

Xu said MSCI’s decide to include China stocks in an index and other developments are encouraging investors to give more attention to fundamentals than speculative factors.

The tech-heavy start-up board ChiNext, which has been sliding, rose 2.6 percent in the morning. However, traders expect a general retreat from start-ups will not end soon amid falling profits at leading tech firms.

Sector performance was mixed in the morning.

Material and energy shares led the declines. Transport gained ground, aided by a surge in Ningbo Port, which rose nearly 10 percent on speculation of a bay area development near Hangzhou.


Hong Kong’s benchmark Hang Seng index, which has gained the past three days, was up on Thursday as investors took heart from Wall Street, where shares climbed to record highs after the U.S. Federal Reserve kept interest rate unchanged and on strong corporate earnings.

The benchmark was 0.5 percent higher at 27,066.87 by mid-day, helped by gains in technology and energy shares.

Technology sector bellwether Tencent Holdings’ 1.3 percent rise pushed the sector up, though much smaller peers AAC Technologies and Lenovo Group posted slight losses.

Energy shares were helped by oil prices hovering close to 8-week highs after three days of gains, though prices dipped on Thursday.

PetroChina, the biggest stock in the sector by market value, added 1.4 percent.

China Mobile’s 0.5 percent loss made it the biggest decliner on the benchmark and pulled the telecom sector lower.

The Hang Seng China Enterprises Index was up 0.1 percent at 10,846.28.

Reporting by Luoyan Liu, Rushil Dutta and John Ruwitch; Editing by Richard Borsuk

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below