China: Stocks steady, sentiment still soured
[SHANGHAI] China stocks steadied on Tuesday following a sharp sell-off the previous session.
Persistent weakness in small-caps offset gains in defensive stocks, showing investors were growing cautious over tougher regulation.
The blue-chip CSI300 index rose 0.3 per cent, to 3,440.97 points, while the Shanghai Composite Index gained 0.2 per cent to 3,134.57 points.
Yang Hai, strategist at Kaiyuan Securities, described the rebound, which came after the market's over 1 per cent drop on Monday - the biggest percentage loss for the year - as "technical" in nature.
"The market bounced after being over-sold," Mr Yang said, attributing the recent weakness to regulatory tightening.
"The regulatory crackdown on shadow banking is targeting mainly the banking system, not the stock market, but equities have been implicated." Analysts also cited the securities regulator's crackdown, which has driven money into cash-rich blue-chips.
The official Xinhua News Agency said late on Monday that the new draft of China's securities law would tighten rules preventing insider trading and better protect investors.
Stocks expected to benefit from the Xiongan New Economic Zone rose sharply but gave back much of their gains in the afternoon, as investors again showed wariness over the stricter regulatory environment.
Sector performance was mixed, with consumer stocks outperforming the broader market with a 3 per cent rise, as investors sought defensive plays amid bearish trends elsewhere in the market.
REUTERS
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Capital Markets & Currencies
Europe: Stoxx ends lower as auto giants weigh; investors parse inflation data
US: Wall Street stocks fall as markets weigh strong wage data, Fed meeting
Japan may have spent 5.5 trillion yen on Apr 29 intervention, BOJ data suggests
Singapore stocks rise, tracking regional bourses; STI up 0.3%
Asia: Markets build on Wall Street rally, yen holds bounce
Singapore shares open in the red on Tuesday; STI down 0.3%