SHANGHAI: Chinese stocks closed lower on Tuesday, dragged down by coal and power-intensive sectors, while property firms rose after analysts pointed to possible policy easing to support the troubled sector.
The blue-chip CSI300 index fell 1.1%, to 4,883.84, while the Shanghai Composite Index lost 1.3% to 3,546.94 points.
** The coal sub-index fell 2.2% as China stepped up efforts to boost coal output amid short supply, which has led to China's worst power crunch in years.
** China will set a timetable and road map for meeting its carbon emissions target, and correct "one-size-fits-all" practices of power cuts and production limits in some areas, state TV quoted Chinese premier Li Keqiang on Monday.
** China's state planner said on Tuesday it will fully liberalise pricing for electricity generated from coal and that industrial and commercial users will all have to buy from the market.
** Power generation stocks fell, dragging the utilities sub-index down 2.4%.
** Non-ferrous metal stocks, chemicals and steel firms declined between 2.8% and 3.8%.
** Semiconductors, infrastructure, media and broker sectors shed more than 2.5% each.
** Bucking the trend, real estate firms rose 1.5%.
** "We believe the default risks and property market weakness have been largely priced into property stocks," Morgan Stanley said in a note. "Given trough valuations and likelihood of policy easing, we believe risk-reward is favourable at current levels."
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