Social financing data dip seen as failing to support sentiment

China stocks dropped on Thursday, while the Shanghai Composite index touched its lowest in nearly four years.

China stocks dropped on Thursday, while the Shanghai Composite index touched its lowest in nearly four years, amid investor concerns about lean domestic growth with the country's premier warning of increasing downward pressure.

** At the midday break, the Shanghai Composite index was down 51.00 points or 1.99 per cent at 2,510.62, after touching its lowest since Nov. 24, 2014.

** China's blue-chip CSI300 index was down 1.51 per cent, with its financial sector sub-index down by 1.26 per cent, the consumer staples sector slipped 1.48 per cent, the real estate index lost 1.52 per cent and the healthcare sub-index falling 2.5 per cent.

** China's economy faces increasing downward pressure, and the government will take targeted measures to prevent large fluctuations in growth, Premier Li Keqiang said.

** "The market index is already close to its 20-year moving average of 2,450 points, an important support level. The Shenzhen, small-cap and start-up indexes ... are already heavily oversold, so a rebound could happen any time," analysts at Donghai Securities said in a note.

** "In a bearish market, market participants tend to ignore good news, and react to bad news," said a Beijing-based trader, who attributed Thursday's fall to energy stocks' performance, dragged down by falling oil prices. ** China's new bank loans rebounded in September after dipping in the two previous months, central bank data showed, but overall credit conditions stayed tight in an economy chilled by an ongoing tariff war with the United States.

** "The overall falling trend of total social financing growth remains unchanged, and the loosening of the credit situation that the market has been waiting for has not appeared," analysts at Pingan Securities said in a note. ** Chinese H-shares listed in Hong Kong dropped 0.73 per cent to 10,123.67, while the Hang Seng Index slipped 0.15 per cent to 25,424.27.

** The smaller Shenzhen index slipped 1.67 per cent and the start-up board ChiNext Composite index edged 0.87 per cent lower. ** Around the region, MSCI's Asia ex-Japan stock index was weaker by 0.37 per cent, while Japan's Nikkei index was down 0.75 per cent.

** The yuan was quoted at 6.936 per U.S. dollar, 0.18 per cent weaker than the previous close of 6.9235. The U.S. government on Wednesday refrained from naming China as a currency manipulator in a twice-yearly Treasury department report. ** The largest percentage gainers in the main Shanghai Composite index were Jiangsu Xinquan Automotive Trim Co Ltd, which gained as much as 10.03 per cent, followed by Wuxi New Hongtai Electrical Technology Co Ltd, which climbed 10.02 per cent and Zhejiang Chenfeng Technology Co Ltd, which rose 10 per cent.

** The largest percentage losses in the Shanghai index were Shanghai Lansheng Corp, which slipped as much as 10.03 per cent, followed by Kangmei Pharmaceutical Co Ltd, which lost 10.01 per cent and Geo-Jade Petroleum Corp, which fell 10 per cent.

** So far this year, the Shanghai stock index is down 22.54 per cent, while China's H-share index is down 12.9 per cent. Shanghai stocks have declined 9.21 per cent this month. ** The top gainers among H-shares were China Gas Holdings Ltd, which gained as much as 4.61 per cent, followed by People's Insurance Group of China Co Ltd, which climbed up to 3.56 per cent and PICC Property and Casualty Co Ltd, which rose 2.76 per cent.

** The three biggest H-shares percentage decliners were Great Wall Motor Co Ltd, which fell 3.70 per cent, China Petroleum & Chemical Corp, which lost 3.7 per cent and Dongfeng Motor Group Co Ltd, which slipped 3.2 per cent. ** About 7.25 billion shares have traded so far on the Shanghai exchange, roughly 60.8 per cent of the market's 30-day moving average of 11.93 billion shares a day. The volume traded was 13.00 billion shares, as of last trading day.

** At midday, China's A-shares were trading at a premium of 21.66 per cent over the Hong Kong-listed H-shares. ** The Shanghai stock index is below its 50-day moving average and below its 200-day moving average.

** The price-to-earnings ratio of the Shanghai index was 10.98, as of last trading day, while the dividend yield was 2.9 per cent. ** So far this week, the market capitalisation of the Shanghai stock index slipped 1.59 per cent to 27.36 trillion yuan.

** In Hong Kong, the sub-index of the Hang Seng index tracking energy shares dipped 2.5 per cent, while the IT sector fell 0.8 per cent. The top gainer on Hang Seng was Sands China Ltd, up 2.55 per cent, while the biggest loser was China Petroleum & Chemical Corp, which was down 3.68 per cent.