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Shanghai - Most Chinese stocks fell, paced by losses for energy and industrial shares, after the benchmark equity gauge posted three straight weeks of gains.
The Shanghai Composite Index slipped 0.1% as of 07:18, with about three shares falling for every two that rose. Gauges of energy and industrial companies declined after also rising for three straight weeks, while developers decreased on signs China’s property market is cooling. Great Wall led automobile companies higher.
The Shanghai gauge’s 14-day relative-strength index last week crossed the threshold of 70, which some investors see as a signal that a rally is about to reverse. China’s economy expanded more than expected in the second quarter, according to official data released on Friday, while monthly aggregate financing, retail sales and industrial output also beat expectations.
“The market needs consolidation at this level after the recent rebound,” said Wei Wei, an analyst at Huaxi Securities in Shanghai.
“Last week’s data show the economy has basically stabilised. So we are in a fluctuating pattern and there’s no risk for a significant drop in equities.”
The Shanghai Composite traded at 3 052.13. The Hang Seng China Enterprises Index was added 0.1% in Hong Kong, while the Hang Seng Index advanced 0.4%.
Sinopec Oilfield dropped 1.7% and Yanzhou Coal Mining lost 1.4%, while China Railway Construction slumped 8.7%, heading for its biggest drop since February 25. Measures of energy and industrial companies fell at least 0.5%. Great Wall Motor increased 6%, poised for a six-month high.
Housing data
China Vanke retreated 1.7% in Shenzhen, while China State Construction Engineering lost 0.4% in Shanghai. New-home prices excluding government-subsidised housing climbed in 55 cities in June, down from 60 in May among the 70 tracked, the National Bureau of Statistics said on Monday. Prices dropped in 10 cities, compared with four a month earlier.
Official figures released on Friday showed China’s gross domestic growth expanded 6.7% in the second quarter, suggesting the economy is responding to stepped up policy support. Aggregate financing, the nation’s broadest measure of new credit, rose to 1.63 trillion yuan in June, indicating that the nation continues to rely on old growth engines.
Margin traders’ holdings of shares purchased with borrowed money stayed near the highest level in two months last week, with the outstanding balance of margin debt on the Shanghai Stock Exchange staying at around 480 billion yuan.
