BEIJING: China stocks gave up early gains and ended Thursday morning lower in thin trading, pointing to investor caution and an uncertain economic outlook after the yuan’s devaluation.
Airline operators, which tumbled over the past two days, rebounded, after China’s central bank said there is no basis for further depreciation in the yuan, soothing fears that a persistently weaker currency would hurt carriers’ profit.
But most other sectors fell. The CSI300 index lost 0.7 percent, to 3,989.12 points at the end of the morning session, while the Shanghai Composite Index fell 0.6 percent, to 3,862.06 points.
Gerry Alfonso, a director at Shenwan Hongyuan Securities, said investors are “apparently taking a wait-and-see attitude” and “behaving rather cautiously.”
Defence businesses, which had been rising sharply recently on expectations of consolidations, fell over 4 percent on profit-taking, while the agricultural sector also posted a big correction.
Stocks rose in Hong Kong, though. The Hang Seng index added 0.3 percent to 23,986.76 points, while the Hong Kong China Enterprises Index gained 0.4 percent, to 11,089.81.
