Most Chinese stocks fell after Moody’s Investors Service cut the debt ratings of six European nations and a former central bank official said the government is unlikely to significantly loosen credit this year.
Jiangxi Copper Co. led a decline for commodity producers on concern the European debt crisis will curtail demand for metals. Huayi Brothers Media Corp. and Zhejiang Huace Film & TV Co. rose more than 1 percent after the government told its television broadcasters to limit the number of imported series they show.
The Moody’s downgrade is “not new but the timing is quite surprising,” Andy Mantel, founder and chief executive officer of Pacific Sun Advisors, said in an interview with Bloomberg Television today from Hong Kong. “You’ll see a bit negative shock for Asian markets as a whole.”
The Shanghai Composite Index (SHCOMP) slipped 0.1 percent to 2,350.36 at 9:36 a.m. local time. The CSI 300 Index added 0.1 percent to 2,533.14. The Bloomberg China-US 55 Index, the measure of the most-traded U.S.-listed Chinese companies, rose 1.6 percent in New York.
The Shanghai Composite has rebounded 6.9 percent this year on speculation the central bank will further cut lenders’ reserve-requirement ratios to spur growth. It announced a reduction in reserve ratios on Nov. 30, the first reduction since 2008, after boosting them and interest rates last year to cool inflation that accelerated to its fastest pace in three years in July.
Inflation Slowing
China’s inflation rate may be about 3 percent in February, the China News Service reported yesterday, citing Zhou Wangjun, deputy director at the price department of the National Development and Reform Commission. Consumer prices rose 4.5 percent last month.
Most Chinese stocks rose yesterday after Premier Wen Jiabao said the nation needs to start “fine-tuning” economic policies this quarter, fueling speculation the government will soon ease policy to preserve growth in the world’s second-biggest economy. New lending missed estimates by 26 percent in January and money supply grew the least in more than a decade, according to data released by the central bank on Feb. 10 after the market closed.
The government is unlikely to significantly loosen credit this year if the economy faces difficulties, Wu Xiaoling, former deputy governor of the central bank, said at a forum in Beijing yesterday. Economic growth is set to slow this year as a result of weakening external demand, Xia Bin, an adviser to the central bank, said yesterday.
European Downgrades
Spain was downgraded to A3 from A1 with a negative outlook, Italy was downgraded to A3 from A2 with a negative outlook and Portugal was downgraded to Ba3 from Ba2 with a negative outlook, Moody’s said. The agency also revised its outlook on the U.K.’s and France’s top Aaa rating to “negative.”
Europe is China’s biggest export market, making up about 18 percent of the nation’s overseas shipments, according to Shenyin & Wanguo Securities Co.
Chinese media companies advanced after the State Administration of Radio, Film and Television issued rules barring all foreign TV series from the prime-time hours of 7 p.m. to 10 p.m. and restricting overseas-made shows to no more than 25 percent of total programming time each day.
The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., advanced for the first time in three days, increasing 1.3 percent to $39.42.
Jiangxi Copper Co. led a decline for commodity producers on concern the European debt crisis will curtail demand for metals. Huayi Brothers Media Corp. and Zhejiang Huace Film & TV Co. rose more than 1 percent after the government told its television broadcasters to limit the number of imported series they show.
The Moody’s downgrade is “not new but the timing is quite surprising,” Andy Mantel, founder and chief executive officer of Pacific Sun Advisors, said in an interview with Bloomberg Television today from Hong Kong. “You’ll see a bit negative shock for Asian markets as a whole.”
The Shanghai Composite Index (SHCOMP) slipped 0.1 percent to 2,350.36 at 9:36 a.m. local time. The CSI 300 Index added 0.1 percent to 2,533.14. The Bloomberg China-US 55 Index, the measure of the most-traded U.S.-listed Chinese companies, rose 1.6 percent in New York.
The Shanghai Composite has rebounded 6.9 percent this year on speculation the central bank will further cut lenders’ reserve-requirement ratios to spur growth. It announced a reduction in reserve ratios on Nov. 30, the first reduction since 2008, after boosting them and interest rates last year to cool inflation that accelerated to its fastest pace in three years in July.
Inflation Slowing
China’s inflation rate may be about 3 percent in February, the China News Service reported yesterday, citing Zhou Wangjun, deputy director at the price department of the National Development and Reform Commission. Consumer prices rose 4.5 percent last month.
Most Chinese stocks rose yesterday after Premier Wen Jiabao said the nation needs to start “fine-tuning” economic policies this quarter, fueling speculation the government will soon ease policy to preserve growth in the world’s second-biggest economy. New lending missed estimates by 26 percent in January and money supply grew the least in more than a decade, according to data released by the central bank on Feb. 10 after the market closed.
The government is unlikely to significantly loosen credit this year if the economy faces difficulties, Wu Xiaoling, former deputy governor of the central bank, said at a forum in Beijing yesterday. Economic growth is set to slow this year as a result of weakening external demand, Xia Bin, an adviser to the central bank, said yesterday.
European Downgrades
Spain was downgraded to A3 from A1 with a negative outlook, Italy was downgraded to A3 from A2 with a negative outlook and Portugal was downgraded to Ba3 from Ba2 with a negative outlook, Moody’s said. The agency also revised its outlook on the U.K.’s and France’s top Aaa rating to “negative.”
Europe is China’s biggest export market, making up about 18 percent of the nation’s overseas shipments, according to Shenyin & Wanguo Securities Co.
Chinese media companies advanced after the State Administration of Radio, Film and Television issued rules barring all foreign TV series from the prime-time hours of 7 p.m. to 10 p.m. and restricting overseas-made shows to no more than 25 percent of total programming time each day.
The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., advanced for the first time in three days, increasing 1.3 percent to $39.42.
