China stocks expected to open lower Wednesday
Chinese stocks fell Tuesday with the benchmark Shanghai Composite Index down 1.38 percent, or 33.35 points, to end at 2,376.84.
The Shenzhen Component Index dipped 1.75 percent, or 179.77 points, to end at 10,116.39.
With global markets overnight trending lower on concerns of a slowdown in China citing European economic woes, the Chinese market is expected to open lower today.
On Tuesday, the Hang Seng Index (HSI) fell 1.1 percent to 20,888.24, its lowest close since March 7. Volume was about 3.8 percent more than the 30-day intraday average.
This was after China’s government raised fuel prices and as a Federal Reserve board member warned the U.S. economy isn’t “out of the woods.
HK stocks are also expected to open lower Wednesday.
That said, the Hang Seng Index rose 15 percent this year through yesterday amid signs the U.S. economy is improving and as China reduced curbs on bank lending. The advance has boosted the price of shares on the gauge to 10.7 times estimated earnings.
That compares with 13.5 times for the S&P 500 Index and 11.4 times for the Stoxx Europe 600 Index.
Of the 116 companies on the Hang Seng Composite Index (HSCI) that have reported full-year earnings since January, 56 percent have exceeded analysts’ estimates, according to data compiled by Bloomberg. Health-care and basic materials companies recorded the biggest increases in earnings per share, while industrial companies were the only ones among 10 industries to report a decrease.
China Telecom Corp. (728), the country’s biggest fixed-line carrier, slid 3.1 percent to HK$4.36 after its fourth-quarter profit missed analysts’ estimates because of costs to add mobile subscribers.
Shangri-La Asia Ltd. (69), a Hong Kong-based hotel operator, slumped 7.8 percent to HK$17.06 after saying its net income for the year ended Dec. 31 fell to $253 million from $287 million a year earlier.
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