News & Reports News Year 2011 October , 2011 Market wilts over growth concerns

Market wilts over growth concerns

SHANGHAI'S stock market yesterday fell for a fourth day, ending the worst week in five months, amid worries that slowing economic growth and a change in resource tax could hurt company earning.

The Shanghai Composite Index dropped 0.6 percent to close at 2,317.28 points, the lowest since March 2009.

The index's loss over this week was 4.7 percent, the biggest drop since the five days through May 27, after it was reported China's gross domestic product grew 9.1 percent in the third quarter, the slowest in two years.

Gong Wei, a fund manager at China Nature Asset Management, said: "The major impact still comes from slower economic growth and tight liquidity in China."

Gong said he expected market sentiment will remain low in the fourth quarter.

PetroChina, the biggest index component and the country's largest oil producer, fell 0.9 percent to 9.65 yuan (US$1.51).

The company might record a 50 billion yuan loss in its refining business this year as its annual resource tax payments could rise to 29 billion yuan, according to company President Zhou Jiping.

Metal producers were also among the losers. Zhongjin Gold shed 3.5 percent to 20.01 yuan. Zijin Mining lost 1.7 percent to 4.10 yuan.

Companies related to environment protection gained after the State Council, China's Cabinet, ordered firms to include spending on environment protection in annual fiscal budgets and pledged to offer tax discounts for outperforming companies. Tianjin Capital Environmental Protection rose 2.1 percent to 5.36 yuan.