Mainland stocks end lower on profit-taking

Source:Global Times Published: 2017/8/13 17:38:39

Chinese mainland stocks dipped over the past week as investors started to take profit in cyclical sectors amid rising geopolitical tension between the US and North Korea.

The benchmark Shanghai Composite Index lost 1.63 percent to end on 3,208.54 points last Friday, notching its sharpest daily fall this year. For the past week, the index fell 1.6 percent.

The blue-chip CSI300 index, which tracks large companies listed on the Shanghai and Shenzhen bourses, also suffered a weekly loss of 1.6 percent. On Friday, the blue chips closed down 1.85 percent at 3,647.35 points. CSI300 stock index futures in August so far have shed 2.0 percent to 3,627.8 points.

Nonferrous experienced the largest drops Friday, with China Northern Rare Earth Group High-tech Co falling 8.34 percent and the Yunnan Chihong Zinc and Germanium Co losing 9.71 percent.

Iron and steel stocks also led the dips. The index that tracks the materials sector fell 5.0 percent after it had risen more than 16 percent since the beginning of the third quarter.

Analysts said that market investors chose to take profits in those stocks as they are concerned over rising tensions between the US and North Korea.

The losses were not just confined to materials firms. The consumer sector fell 9.5 percent last Friday with a weekly loss of 9.4 percent.

Meanwhile, defense industry firms were among the outperforming ones. Bestway Marine and Energy Technology Co rose by the daily limit of 10 percent to 9.12 yuan ($1.37).

The mainland's major stocks could continue on a downward trend amid bearish expectations in the short term while Shanghai stocks could linger at the 3,200 level before a rally, according to media reports.

This week, China is set to release a flurry of July economic figures, from fixed-asset investments to industrial output, which many analysts expect could send a positive signal for the country's economic growth in the third quarter.

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