SINGAPORE: Chinese shares fell in heavy trade on Monday, with consumer and property companies suffering the most significant losses, driven by economic data and doubts over a report suggesting China may ease mortgage refinancing.
The Shanghai Composite index closed down 1.1% at 2,811.04 points.
China’s blue-chip CSI300 index finished 1.7% lower and the real estate index fell 4.1%. The consumer staples sector fell 3.1% and the food and beverage index dropped 3.5%.
Chinese H-shares listed in Hong Kong closed 1.9% lower at 6,211.61, while the Hang Seng Index ended down 1.7% at 17,691.97.
A private survey showed that China’s new home prices barely rose in August, while developers China Vanke and Hong Kong’s New World Development reported losses.
New World Development shares suffered the largest fall on the Hang Seng, slumping 13% to a two-decade low after the company estimated a net loss as deep as HK$20 billion ($2.6 billion) for the year ended June 30.
China Vanke shares fell 5% after the state-backed property giant reported a core loss of 7.6 billion yuan ($1.1 billion) in the first half on Friday, underscoring the depth of the malaise in the sector.
Analysts also assessed the effect of potential loosening of mortgage refinancing rules which were reported by Bloomberg News on Friday.
“Refinancing with different banks is unlikely to be allowed,” Nomura economist Ting Lu said, though he nevertheless expects cuts to mortgage rates that could save borrowers about 100 billion yuan ($14 billion) a year in repayments.
The top three H-share losers were bottled water seller Nongfu Spring, down 5.5%, China Resources Land, down 5.4%, and China Overseas Land & Investment, down 4.7%.
Caixin/S&P Global manufacturing PMI swung back to growth in August, data showed on Monday. Still, a survey of larger companies on Saturday showed activity contracted for a fourth month.
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