Chinese Stocks Extend Bear-Market Losses Before Growth Report

Chinese stocks extended bear-market losses as commodity companies tumbled on slumping raw-material prices and concern a flood of data this week will show a deepening economic slowdown.

The Shanghai Composite Index dropped 0.6 percent to 2,883.37 at 10:34 a.m., culminating in a 21 percent loss since December. Trading volumes slumped more than 30 percent below the 30-day average for this time of day on Monday, while volatility hovered near the highest levels since October after Chinese stocks fell into a bear market for the second time in seven months on Friday. PetroChina Co. and Baoshan Iron & Steel Co. led declines.

China’s stock strategists are bracing for a deeper bear market on waning confidence that the government can manage the country’s transition to a new growth model and to a more freely traded currency. Tuesday’s data are forecast to show gross domestic product for the fourth quarter and full year was below the government’s target, according to a Bloomberg survey of economists.

The CSI 300 Index declined 0.5 percent, while Hong Kong’s Hang Seng China Enterprises Index fell 0.3 percent and the Hang Seng Index lost 0.9 percent.

Source: Bloomberg


China Stocks Pull Back From Bear-Market Brink as Smallcaps Jump

Chinese stocks rebounded from the brink of a bear market in a late-day swing as the lowest valuations in four months lured bargain hunters and a group of smaller companies pledged to support their share prices.

The Shanghai Composite Index gained 2 percent to 3,007.65 at the close, reversing a loss of as much as 2.8 percent and sending a gauge of volatility to the highest levels since September. The ChiNext small-caps index surged the most in two months after 28 listed companies vowed to take action to stabilize the market, with some pledging not to sell shares over the next six months. State funds may have entered to buy stocks after the Shanghai index fell below the lowest levels reached in last year’s rout, according to Galaxy Securities Co.

The Shanghai gauge earlier dropped below the low of 2,927.29 set in August, when a summer rout wiped out $ 5 trillion and spurred the government to impose emergency rescue measures. The index, the worst performer among 93 global benchmark measures tracked by Bloomberg this year, fell as much as 20 percent from the December high before paring losses.

Source : Bloomberg