BEIJING: China’s stocks slumped, dragging the benchmark index down the most in three weeks, after data over the weekend added to concern the economic slowdown is deepening.
The Shanghai Composite Index slid 3.2 percent at the 11:30 a.m. local-time break, led by technology and financial companies. The value of shares traded on the gauge was 26 percent below the 30-day average for this time of day. The Hang Seng China Enterprises Index dropped 0.7 percent, reversing a 1.4 percent advance.
August economic data released Sunday showed a challenging picture for policy makers. Industrial output missed economists’ forecasts, while investment in the first eight months increased at the slowest pace since 2000. The government also announced some details about plans to reform state-owned enterprises, including encouraging private investment.
“The economic reports don’t look good so investors prefer to be on the sidelines,” said Wu Kan, a Shanghai-based fund manager at JK Life Insurance Co. “The SOE reform rules were widely expected by the market and aren’t very detailed, therefore the reaction is limited. The market could fall to a lower level.”
Industrial output rose 6.1 percent in August from a year earlier, missing the 6.5 percent estimate. Fixed asset investment excluding rural households climbed 10.9 percent in the first eight months versus the 11.2 percent median projection of economists surveyed by Bloomberg. Five interest-rate cuts since November and plans to boost government spending have yet to revive an economy mired in a property slump, overcapacity and factory deflation.
