HONG KONG, April 15 (Reuters): China shares posted their worst loss in
more than two weeks on Monday, while Hong Kong nearly erased most of
last week's gains after weaker-than-expected China GDP data aggravated
the gloom from several Chinese corporate profit warnings.
China's economic recovery unexpectedly stumbled in the first three months of 2013 to 7.7 per cent from the previous quarter's 7.9 per cent and below an 8.0 per cent poll consensus, sparking a broad sell-off in cyclical sectors.
The Hang Seng Index declined 1.4 per cent to 21,772.7, almost paring last week's gains that came in low turnover. The China Enterprises Index of the leading Chinese listings in Hong Kong sank 2 per cent.
The Shanghai Composite Index shed 1.1 per cent and the CSI300 of the top Shanghai and Shenzhen A-share listings lost 1 per cent.
Both closed at their lowest since March 28, with gold miners among the biggest drags after gold prices sank to a 2-year low.
Shanghai volume increased slightly from last Friday, but was still some 24 per cent below its average in the last month, the tenth session it had remained under that level.
Hong Kong turnover was 16.5 per cent below average.
"This drop in gold prices is a precursor to more volatility in the stock markets. I won't be adding excessive risk before China's second quarter data," said Hong Hao, chief strategist at Bank of Communication International Securities.
"The bad market reaction today is a result of raised expectations after last week's credit growth figures. This China GDP miss probably points to ineffectual credit growth because money is being used by companies to pay off short-term loans and interest," Hong added.
Expectations for a stronger growth figure were elevated last week when data showed total social financing, the central bank's broad measure of liquidity in the economy that includes non-bank lending, surged to 2.54 trillion yuan ($410.2 billion) in March from February's 1.07 trillion yuan.
On Monday, Chinese oil major CNOOC Ltd was among the biggest drags on the Hang Seng Index, diving 3.1 per cent to its lowest closing level since June with Brent oil gravitating back towards a 9-month low set last Friday.
Now trading at HK$13.74, chart support is next seen at HK$13.18, its June 5 trough. A break below this level may point to more losses ahead. It is now down nearly 20 per cent this year, compared with the Hang Seng Index's 4 per cent loss.
Chinese gold miners were among the bigger per centage losers in the A-share market as gold prices extended a downward spiral on Monday after posting last Friday its biggest one-day slide since 2008.
Zijin Mining tumbled 5.6 per cent in Shanghai and 7.2 per cent to its lowest close since July in Hong Kong. Its H-share listing is now down 24 per cent this year, compared with the 9 per cent slide for the China Enterprises Index.
China's economic recovery unexpectedly stumbled in the first three months of 2013 to 7.7 per cent from the previous quarter's 7.9 per cent and below an 8.0 per cent poll consensus, sparking a broad sell-off in cyclical sectors.
The Hang Seng Index declined 1.4 per cent to 21,772.7, almost paring last week's gains that came in low turnover. The China Enterprises Index of the leading Chinese listings in Hong Kong sank 2 per cent.
The Shanghai Composite Index shed 1.1 per cent and the CSI300 of the top Shanghai and Shenzhen A-share listings lost 1 per cent.
Both closed at their lowest since March 28, with gold miners among the biggest drags after gold prices sank to a 2-year low.
Shanghai volume increased slightly from last Friday, but was still some 24 per cent below its average in the last month, the tenth session it had remained under that level.
Hong Kong turnover was 16.5 per cent below average.
"This drop in gold prices is a precursor to more volatility in the stock markets. I won't be adding excessive risk before China's second quarter data," said Hong Hao, chief strategist at Bank of Communication International Securities.
"The bad market reaction today is a result of raised expectations after last week's credit growth figures. This China GDP miss probably points to ineffectual credit growth because money is being used by companies to pay off short-term loans and interest," Hong added.
Expectations for a stronger growth figure were elevated last week when data showed total social financing, the central bank's broad measure of liquidity in the economy that includes non-bank lending, surged to 2.54 trillion yuan ($410.2 billion) in March from February's 1.07 trillion yuan.
On Monday, Chinese oil major CNOOC Ltd was among the biggest drags on the Hang Seng Index, diving 3.1 per cent to its lowest closing level since June with Brent oil gravitating back towards a 9-month low set last Friday.
Now trading at HK$13.74, chart support is next seen at HK$13.18, its June 5 trough. A break below this level may point to more losses ahead. It is now down nearly 20 per cent this year, compared with the Hang Seng Index's 4 per cent loss.
Chinese gold miners were among the bigger per centage losers in the A-share market as gold prices extended a downward spiral on Monday after posting last Friday its biggest one-day slide since 2008.
Zijin Mining tumbled 5.6 per cent in Shanghai and 7.2 per cent to its lowest close since July in Hong Kong. Its H-share listing is now down 24 per cent this year, compared with the 9 per cent slide for the China Enterprises Index.
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