China Focus: Chinese shares in biggest weekly drop since 2008

China Focus: Chinese shares in biggest weekly drop since 2008

BEIJING, June 19 (Greenpost) — Chinese shares plummeted on Friday, with the benchmark Shanghai Composite Index down 6.42 percent to finish at 4,478.36 points.

The Shenzhen Component Index lost 6.03 percent to close at 15,725.47 points.

The major Shanghai index dived by 13 percent from the previous week, in the biggest weekly drop in seven years. Nearly one thousand shares on the two bourses slumped by the daily limit of 10 percent.

During Friday’s trading, losers outnumbered winners by 903 to 25 in Shanghai, and by 1,295 to 96 in Shenzhen.

Combined turnover for the two bourses shrank to 1.29 trillion yuan (210.23 billion U.S. dollars) from Thursday’s 1.5 trillion yuan.

Stocks relating to nuclear power, transportation, medical care, online education, mobile games and reform of state-owned enterprises were the biggest losers.

Guangzhou Baiyun International Airport Company dived by the daily limit of 10 percent to close at 17.77 yuan per share. Shanghai Electric Group Company lost 9.98 percent to end at 17.23 yuan.

The ChiNext Index, tracking China’s Nasdaq-style board of growth enterprises, dived 5.41 percent to end at 3,314.98 points.

Analysts attributed the plunge mainly to four factors. Firstly, new listings of stocks, especially large-cap shares have kept drawing money away from the market.

On Thursday, Chinese securities trader Guotai Junan Securities Co., Ltd. became the largest domestic IPO in nearly five years after launching on the Shanghai Stock Exchange. The company will sell up to 30.1 billion yuan (4.92 billion U.S. dollars) at 19.71 yuan per share, according to its IPO prospectus filed with the Shanghai Stock Exchange on Tuesday.

Secondly, market regulator the China Securities Regulatory Commission (CSRC) last week banned illicit loans for stock purchases, and announced that margin trading outside the brokerage system would be strictly punished. It is estimated that the move will prevent around 500 billion yuan from entering the market.

Thirdly, companies need to settle their account balance and complete payment to banks in the middle of the year, resulting in a shortage of funds and hence the fall of the major index.

Last but not least, the stock market has posted dramatically large gains since the beginning of the year, with the ChiNext Board index rising 170-percent rise at its peak without a proper callback, until the current correction comes.

Analysts warned that the biggest threat to the market is the high-rate rise, and the current nosedive could help release accumulated risks.

The Chinese stock market has seen an impressive rebound since the second half of 2014 after being stuck in the doldrums for about six years.

The major Shanghai index closed at fresh seven-year highs for several consecutive days last month, before posting another nosedive on record turnover on May 28.

On June 5, the major Shanghai index surpassed the 5,000-point landmark for the first time in over seven years, jumping to 5,023.1 points. Enditem

Source Xinhua

Editor  Xuefei Chen Axelsson

NDRC to propose plan on construction of global logistics channel

NDRC to propose plan on construction of global logistics channel

BEIJING, June 19 (Greenpost) – China’s top economic planner – the National Development and Reform Commission (NDRC) said on its website on Friday that it intended to come up with a plan on constructing the grand global logistics channel to solve the major problems troubling Chinese companies.

NDRC made the decision at a recent symposium which China Railway Corp. China Petrochemical Corp (Sinopec Group), China Merchants Group, SinoTrans&CSC Holdings Co., Ltd., COSCO Group, China Post Group, and S.F. Express and China Federation of Logistics & Purchasing were asked to attend to report their progresses and difficulties in “going global” in logistics sector and give suggestions for constructing the global logistics channel.

The NDRC said it would propose a feasible plan on this regard after further study of advices from these businesses. (Edited by Duan Jing,


China’s software sector presents new features

China’s software sector presents new features

DALIAN, June 19 (Greenpost) – China’s software industry has exhibited new trends and features alongside the rapidly developing global software and information services market, according to a report released on China International Software and Information Service Forum 2015 held here Friday.

In 2014, the country’s software export continued to rise at a fast pace and industrial structure was further optimized together with service taking up a steadily rising proportion in the entire software sector.

Meanwhile, software developers revealed an eye-catching profitability when labor costs rose constantly.

Besides, software business in central and west China saw faster revenue growth than in other places of China. (Edited by Duan Jing,

Source Xinhua

Editor  Xuefei Chen Axelsson