China: Stocks edge down despite signs of economic recovery

[SHANGHAI] China's main share indexes edged down on Wednesday but stayed close to their highest levels since early January as the latest survey on the country's service sector activity provided fresh evidence of a nascent economic recovery.

The blue-chip CSI300 index fell 0.2 per cent, to 3,257.53, while the Shanghai Composite Index lost 0.1 per cent, to 3,050.59 points, staying comfortably above 3,000 points - a level many see as psychologically important.

On Tuesday, the two indexes closed at their highest since Jan 8.

Activity in China's service sector strengthened last month, according to the Caixin/Markit services purchasing managers'index (PMI), which in March rose to 52.2 from February's 51.2.

March's moderate expansion in the service sector, which follows rises in January-February industrial profits and PMI, lends support to belief that China's economy is improving on the back of Beijing's supportive measures.

The Shenzhen market outperformed its Shanghai peer on Wednesday, drawing some support from expectations the Shenzhen-Hong Kong Stock Connect will be launched soon. UBS expects the investment scheme will be kicked off "over the next few months".

REUTERS