SHANGHAI: Shanghai stocks rose on Wednesday as real estate and banks rebounded sharply, but the blue-chip index fell, dragged down by healthcare and consumer staple shares.
The Shanghai Composite Index gained 0.1% to 3,532.62 points, while the blue-chip CSI300 index fell 0.6% to 5,015.34.
China’s CSI300 Real Estate Index surged 5.8% as China Evergrande Group’s moves to ease its liquidity stress soothed concerns toward the industry.
The healthcare sub-index dropped 1.7%, while the consumer staples sub-index fell 1.6%. Both indexes gained more than 0.9% yesterday.
Evergrande said late on Tuesday it was in discussions with several third-party investors on the proposed sale of certain assets. The stock surged as much as 12% in Hong Kong.
Market expectations of a new rule to cap the land price premium at 15% by Ministry of National Resources also boosted confidence in the sector. The policy if implemented would cut developers’ cost of land purchases.
Guosen Securities wrote in a note that despite lingering pressure on China’s real estate sector, the chance of further substantial tightening was becoming slimmer. Investors are seeing the light at the end of the tunnel for developers’ credit issuance, so valuations could be repaired, the brokerage wrote.
Banking shares also rose, with the banks sub-index finishing up 1%, as investors bet lenders’ asset quality will improve along with developers’ financial health.
Comments
Comments are closed.