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China's shares inched lower yesterday after a technical rebound the previous day fizzled out amid persistently poor overall sentiment, brokers said.
The benchmark Shanghai composite index, grouping hard-currency B shares for foreigners and yuan-denominated A shares, nudged down 0.23 percent to 1,446.512 points.
Stocks rallied on Monday after a move to allow brokerages to issue bonds galvanized a liquidity-strapped market. But in the absence of other factors to sustain a rally, the benchmark index is likely to move narrowly in the near term, analysts said.
"Trade is not active enough to keep up the technical rebound, while bearish sentiment drove investors to take quick profits," said analyst Qian Weihai at Jinxin Securities.
Investor confidence is still weak after a 6 percent slide since mid-July, hit by a slew of negative factors from an abundance of stock offers to a tightening of bank loans, brokers said.
Cautious investors favoured counters that displayed strong interim results, such as computer software and hardware maker Aerospace Information Co, Ltd.
Its A shares, open to local and select foreign investors, surged their 10-per-cent daily limit to 39.57 yuan (US$4.8) after the company reported the highest interim earnings per share, at 2.01 yuan (24 US cents), of the exchange's 1,200-odd listed counters.
Department store operator Join Buy Co, Ltd also rose its 10 percent daily limit to 5.71 yuan (69 US cents). The company unveiled on Saturday a US$100 million joint venture with its parent and foreign investor Gainbest Assets Ltd.
The Shanghai B-share index edged down 0.18 percent to 102.441 points, while its Shenzhen counterpart dipped 0.52 percent to 228.23.
On the foreign exchange market, China's yuan ended unchanged versus the US dollar at 8.2770 yesterday, at the stronger end of its managed trading range.
The yuan moves in a band from 8.2760 to 8.2800 to the dollar, enforced by the central bank. Turnover rose to a decent US$680 million from US$620 million on Monday.
The yuan firmed yesterday to 7.0879 against 100 Japanese yen from 7.0944, and strengthened versus the euro to 9.0250 from 9.0900.
In the futures market, Shanghai copper futures closed higher yesterday, buoyed by a slight rise in the London Metal Exchange's close and hopes that the LME would extend its gains, traders said.
The most active January copper contract rose 80 yuan (US$9.70) to 18,070 yuan (US$2,183) a ton, with other futures ended 50 yuan (US$6) to 100 yuan (US$12) higher. Combined volume dipped to a moderate 56,998 lots from 68,604 lots on Monday.
"Expectations of further LME rises boosted some sentiment in the Chinese market," said a Shanghai trader.
LME three-month copper ended up US$7 at US$1,773 a ton in Monday's trade, as a raft of US economic data to be released later yesterday was expected to prop up prices, traders said.
Spot copper in Shanghai rose 70 yuan (US$8.50) to 80 yuan (US$9.70) in a range of from 17,850 yuan (US$2,156) to 17,940 yuan (US$2,167) on Monday, tracking futures.
Shanghai aluminium futures ended 10 to 20 yuan (US$1.20-US$2.40) higher, while combined volume expanded to a moderate 8,590 lots from a thin 5,858 lots on Monday. LME aluminium inched up US$1 to US$1,434 by Monday's close.
(China Daily September 3, 2003)
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