Hong Kong: China stocks tumbled the most in two weeks after an official manufacturing gauge indicated the first contraction in more than two years and China Minsheng Banking Corp.’s president Mao Xiaofeng resigned.
China Minsheng led declines for financial companies, sliding 4.5% after Caixin magazine reported that Mao is being investigated by authorities. China Railway Construction Corp. and Air China Ltd dropped more than 4% after the government’s Purchasing Managers’ Index (PMI) declined to 49.8 last month from 50.1 in December. The nation’s benchmark money-market rates jumped for a fourth day after the securities regulator approved 24 initial public offerings (IPO).
The Shanghai Composite Index slid 1.9% to 3,147.99 at 9:37am. The gauge has fallen 6.8% over the past five days as the government stepped up scrutiny of margin lending, while the factory data add to concern the economy is weakening. “The weak PMI figure is putting some downward pressure on the market,” said Gerry Alfonso, a China equity sales and trading director at Shenwan Hongyuan Group Co. in Shanghai.
“The recent developments on Minsheng bank are also adding pressure to bank-related stocks.” The CSI 300 Index slid 1.9%. Hong Kong’s Hang Seng China Enterprises Index fell 1.4%, while the Hang Seng Index dropped 0.4%. The Bloomberg China-US Equity Index, the measure of the most-traded US-listed Chinese companies, retreated 1.6% in New York on 30 January. China’s outstanding margin debt dropped for the first time in eight days on 30 January in Shanghai, according to data from the city’s bourse. It fell 0.5% to 773.98 billion yuan ($123 billion) from a record 777.6 billion yuan on 29 January.
