24 June 2009 | China Economic Scan

24-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: China East Star Airlines gets offer from investors, Wuhan steel to invest $400m in Brazil ore assets, CapitaLand Retail says Chinese land too expensive, Gome shares jump on Bain investment, Chinese stocks fall on Tuesday.

Top 5 headlines

China East Star Airlines gets offer from investors

• East Star Airlines, a debt-ridden privately held Chinese carrier, said it will sell at least an 85 percent stake in the firm to help it make a comeback.
• East Star will get at least 500 million yuan ($73.2 million) from outside investors, led by little known Shanghai Yujie Industry Co, the company said in a statement late on Monday. No timetable or details of other investors were available.
• The small carrier has filed for bankruptcy protection with a local court in Wuhan, its home base. It has total debt of more than 500 million yuan, Wu Yue, a lawyer hired by the company, told reporters at a news conference.

Wuhan Steel May Add to $400 Million Brazilian Ore Investment

• Wuhan Iron & Steel Group, offering $400 million to buy Brazilian iron ore assets, will seek other investment opportunities in countries including Australia to meet its rising demand for the steelmaking material.
• China’s third-largest steelmaker is seeking partners that are “honest and faithful,” spokesman Bai Fang said today. “It doesn’t matter whether our target is a big miner or not,” he said.
• Wuhan Steel offered to buy a stake in MMX Mineracao e Metalicos SA and a unit for $400 million, Rio de Janeiro-based MMX said yesterday. China may spend more than $500 billion on foreign resource investments over the next eight years, according to Deloitte Touche Tohmatsu.

CapitaLand Retail Delays Land Acquisitions in China

• CapitaLand Retail Ltd. said China land remains too expensive for it to make acquisitions and the unit of Southeast Asia’s biggest developer will instead focus on completing its shopping mall projects in the country.
• “I don’t think it’s the right time” to buy more land for retail projects in China, Lim Beng Chee, chief executive officer of CapitaLand Ltd.’s retail unit, said in an interview.
• Hong Kong’s Hang Lung Properties Ltd. and Shimao Property Holdings Ltd. resumed land purchases in China this year as home prices rise in the world’s third-biggest economy. CapitaLand Retail operates 29 malls in China, and plans to open 29 more in the next three years, Lim said yesterday in Singapore.

Gome shares jump 70 percent on Bain investment

• Shares of Gome Electrical Appliances, China's leading home appliance chain, jumped nearly 70 percent Tuesday after announcing an investment from U.S. private equity firm Bain Capital.
• The shares surged 69 percent to 1.9 Hong Kong dollars (24.5 cents) in their first day of trade since being suspended in November amid a corruption investigation centered on the company's tycoon founder.
• Gome said Monday it plans to raise at least $417 million by issuing convertible bonds to Bain and selling new stock to existing shareholders.

China shares fall on worries about world economy

• Chinese shares snapped a four-day rally and fell slightly Tuesday on worries about the world economy, but banking and steel stocks gained.
• PetroChina Ltd., Asia's biggest oil and gas producer, shed 2.5 percent to 13.88 yuan, while China Petroleum & Chemical Corporation lost 2 percent to 10.31 yuan.
• China Shenhua Energy Ltd., the country's biggest coal producer, declined by 3.1 percent to 26.57 yuan, while Pingdingshan Tianan Coal Mining Co. gave up 3.2 percent to 35.9 yuan.

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	17,538	-521.18	-2.89%
Shanghai Composite	2,893	-3.6	-0.12%
Shenzhen Component	11,126	-65.05	-0.58%
TAIEX	6,197	-143.74	-2.27%
CNY/USD	6.8348	-0.0004	-0.01%

Source: China Economic Scan

23 June 2009 | China Economic Scan

23-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: New loans in China to reach 6.5 trillion in H1, Citic says transfer of state held shares a positive move, China refines record level of crude oil May, China Minsheng wins investor approval for Hong Kong share sale, Chinese stocks gain for fourth day.

Top 5 headlines

New loans may reach 6.5t yuan in H1

• China's new yuan loans in the first 20 days in June exceeded that of the same period in May, making it possible that new loans may reach 6.5 trillion yuan ($951 billion) in the first half of 2009.
• According to the source, banks also tend to expand their credit line when the month is ending, which makes it almost certain that new loans in June will exceed that of May and that the 6.5-trillion expectation will come true, considering the current trend for the new loans increase.
• The state council, or the cabinet, slashed the minimum capital requirements for fixed-asset investment projects at the end of last month, lowering the threshold of infrastructure construction projects and increasing the demand for loans.

China’s Transfer of Shares Is Positive, Citic Says

• China’s decision to order companies listed since 2006 to transfer some of their state-held shares to the national pension fund may support the equity market, according to Citic Securities Co.
• The move is “fairly positive,” and the pension fund will act as a stabilizing force for stocks, analysts at the country’s biggest listed brokerage, led by Yu Jun, wrote in a report published today.
• The new rules, announced by the Ministry of Finance on June 19, require the transfer of 8.4 billion state-held shares in 131 listed companies, and the stocks will be barred from trading for another three years after existing lock-up periods expire.

China refines more crude oil in May, hits record high

• China refined a record 31.19 million tonnes of crude oil in May, up 10.7% over the same month last year, according to the China Petroleum and Chemical Industry Association (CPCIA).
• The CPCIA on Monday released figures that showed refined oil output, including gasoline, diesel and kerosene, totaled 19.34 million tonnes, an increase of 16.7% over the same period last year.
• Sales of refined oil topped 18.32 million tonnes in May, up 2.3% from April, with gasoline sales up 2.9% year on year, or 3.6% from April, to hit 5.61 million tonnes.

China Minsheng Wins Investor Approval for Hong Kong Share Sale

• China Minsheng Banking Corp., the nation’s first privately owned lender, won investor approval to revive an initial share sale in Hong Kong after shelving the plan for four years.
• Minsheng Chairman Dong Wenbiao got the go-ahead for the sale at a shareholder meeting today in Beijing, where the bank is based. Minsheng plans to offer stock equivalent to as much as 15% of its enlarged share capital, and may boost the sale by 15% if there’s enough demand.
• UBS AG, Switzerland’s biggest bank by assets, will help manage the stock sale, people familiar with the matter said last week. Minsheng aims to complete the offering by the end of the year barring any “unusual circumstances,” Liu Minwen, director of the capital financing office, told shareholders today.

China’s Stock Index Gains for Fourth Day; ICBC, Ping An Climb

• China’s benchmark stock index rose, led by financial companies, after the Shanghai Securities News said new lending rose and the government required some state- owned companies to transfer stock to the national pension fund.
• Industrial & Commercial Bank of China, the country’s biggest lender, added +3.1%. Ping An Insurance, the nation’s second-largest insurer, gained +3.4% on speculation the requirement will boost its equity investments. Suning Appliance rose +1.4% after saying it plans to sell new shares in a private placement.
• “The confidence and market momentum are still there,” said Yan Ji, who helps oversee about $850 million of investments at HSBC Jintrust Fund Management Co. in Shanghai. “For the national pension fund, it will play a role of stabilizing the market because the fund isn’t unlikely to sell the shares.”

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	18,060	138.62	0.77%
Shanghai Composite	2,896	15.81	0.55%
Shenzhen Component	11,191	-51.58	-0.46%
TAIEX	6,341	110.06	1.77%
CNY/USD	6.8352	-0.0024	-0.04%

Source: China Economic Scan

22 June 2009 | China Economic Scan

22-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: Wen says China should have 'moderately loose' monetary policy, China state firms profits fall 30.3%, China increases cigarette tax, Suning Appliance to raise 3 bln yuan in private placement, Franklin Templeton renews Chinese investment license.

Top 5 headlines

China Should Have ‘Moderately Loose’ Monetary Policy

• China should have a “moderately loose” monetary policy and implement “proactive financial policies,” Premier Wen Jiabao said during a visit to Hebei.
• “We need to fully realize the stimulus measures,” Wen said, according to the statement. “We should focus on structural adjustment while maintaining economic stability and relatively fast growth.”
• Wen “is trying to maintain optimism while acknowledging risks,” David Cohen, head of Asian forecasting at Action Economics in Singapore, said over the phone today. “Global demand will start to pick up and that should provide some boost to Chinese manufacturing.”

China Jan-May state firm profits down 30.3 pct y/y

• Profits at Chinese state-owned enterprises (SOEs) continued to fall in the first five months from year-earlier levels, but the pace of decline slowed from the first four months, an official newspaper said on Saturday.
• Overall profits of SOEs in the first five months reached 425.4 billion yuan ($62.3 billion), down 30.3% from a year earlier, compared with a drop of 32.3% in the first four months, the Securities Times quoted the Ministry of Finance as saying.
• Among them, enterprises controlled by the central government registered profits of 331.55 billion yuan from January to May, down 23.3% year on year, while those backed by local governments had profits of 93.85 billion yuan, down 47.4%.

China increases cigarette tax to add to state coffers

• China has increased tax on cigarettes by between 6-11% to tap additional revenue for for future government spending.
• The tax rise took effect from the beginning of May 1, and a new tax of 5% was also imposed on cigarette wholesalers, China State Administration of Taxation said in a statement posted on its Web site (www.chinatax.gov.cn) on late Friday.
• "This is to appropriately increase the government's fiscal revenue and also to perfect the cigarette taxing system," it said. The tax has not yet been passed on to smokers.

China's Suning to raise 3 bln yuan in placement

• Chinese retailer Suning Appliance said on Saturday that it intended to raise around 3 billion yuan ($439 million) in a private placement for purposes including building new chain shops around China.
• Suning planned to issue up to 200 million new yuan-denominated A shares to private investors, including its chairman Zhang Jindong, it said in a statement published in the China Securities Journal.
• Proceeds would also be used to build six logistics centres in Chinese cities including Beijing and Tianjin and to supplement working capital, it said.

Franklin Templeton Gets Chinese Investment License

• Franklin Resources Inc., manager of the Franklin and Templeton mutual funds, said it received a new license to invest in Chinese stocks and bonds after an earlier permit held by a unit expired.
• Franklin Templeton will also invest in China through private-equity and its joint venture in the world’s third- largest economy, the statement said. It will also buy shares of Chinese companies traded in Hong Kong, it added.
• Citigroup Inc., Goldman Sachs Group Inc. and HSBC Holdings Plc are among more than 80 overseas institutions cleared to invest in Chinese stocks and bonds under the so-called QFII program.

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	17,921
Shanghai Composite	2,880
Shenzhen Component	11,242
TAIEX	6,231
CNY/USD	6.8376

Source: China Economic Scan

20 June 2009 | China Economic Scan

20-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: Report says no change to tax threshold, CDB posts 20.8bln yuan in net profit for 2008, CIC to invest $500m in hedge funds, China securities regulator approves Sanjin IPO, Chinese stocks rise again to close the week up.

Top 5 headlines

Experts push for raising tax threshold

• The first ministerial review of the country's income tax system has recommended that the current tax threshold be maintained, despite repeated calls to raise the level to ease the burden on a growing number of middle-income families and stimulate domestic consumption amid the economic downturn.
• China's personal monthly income tax threshold was increased from 800 yuan ($117) a month in 1980 to the current 2,000 yuan, meaning that workers with a monthly salary of 2,500 yuan or less do not pay any taxes after social insurance deductions.
• Presently, those earning 10,000 yuan a month will pay 825 yuan of tax.

CDB posts 20.8b yuan in net profit last year

• China Development Bank (CDB) posted a net profit of 20.8 billion yuan ($3.04 billion) in 2008, faring far better than the other two major policy banks in China despite a drop of 28% from a year earlier.
• The decline was due to the influence of the Sichuan earthquake, the economic downturn, and the exchange loss over a weak US dollar, the bank said in its 2008 annual report.
• CDB received $20 billion worth of capital funds at the end of 2007, which sharply increased its dollar position in 2008, leading to a greater exchange loss amid the depreciation of the US dollar.

CIC Said to Invest $500 Million in Hedge Funds, Blackstone

• China Investment Corp., the nation’s $200 billion sovereign wealth fund, may invest as much as $500 million in hedge funds including those run by Blackstone Group LP, said two people familiar with the matter.
• CIC aims to allocate $6 billion to hedge funds by the end of 2009, company adviser Felix Chee said two days ago at the GAIM International hedge fund conference at Monaco’s Grimaldi Forum.
• Chee, who is a special adviser to the chief investment officer of CIC, said he will initially run CIC’s hedge fund and proprietary trading effort.

China Permits First IPO Since September; Brokers Gain

• China approved its first initial public offering since September, triggering gains in brokerage shares on speculation the ending of the 10-month moratorium will spur fee income and trading.
• Sanjin, China’s biggest producer of herbal lozenges, aims to raise about 634 million yuan ($93 million). The company will start a roadshow and seek a price for the sale on June 22, it said in a statement late yesterday.
• Zhejiang Wanma Cable Co. and Shenzhen Salubris Pharmaceuticals Co. are also likely to get final IPO approval soon, the people said. The companies each plan to raise less than 650 million yuan, according to documents they’ve filed with the regulator.

China's stocks rise to 10-month high

• China's stocks rose for the third straight day Friday, driving the benchmark index to a 10-month high as financial shares gained after the securities regulator approved the nation's first initial public offering (IPO) since September.
• Sinolink Securities rose by the daily limit of +10% to close at 21.46 yuan. Northeast Securities rose +5.65% to 31.96 yuan.
• Beijing Tiantan Biological Products Co., Ltd. advanced +6.91% to 25.52 yuan, and Dalian Merro Pharmaceutical Limited Company rose by the daily limit of +10% to close at 6.90 yuan.

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	17,921	144.27	0.81%
Shanghai Composite	2,880	26.59	0.93%
Shenzhen Component	11,242	90.66	0.81%
TAIEX	6,231	86.62	1.41%
CNY/USD	6.8376	0.0021	0.03%

Source: China Economic Scan

19 June 2009 | China Economic Scan

19-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: World bank raises China growth forecast to 7.2%, China sees 120% increase in rail investment, China set to grant final approval for first IPO since September, CIC goes on global hiring spree, Chinese stocks rise to 11 month high.

Top 5 headlines

World Bank Raises China 2009 Growth Forecast to 7.2%

• The World Bank raised its growth forecast for China this year and advised policy makers to delay until 2010 any additional stimulus plan to boost the world’s third-largest economy.
• China’s economy will expand 7.2% in 2009 from a year earlier, up from a 6.5 percent forecast in March, the Washington-based lender said in a quarterly report released today in Beijing. Stocks gained after the announcement.
• The World Bank joins Goldman Sachs Group Inc., Morgan Stanley and UBS AG. in raising growth forecasts this year after a 4 trillion yuan ($585 billion) stimulus package triggered record loans and surging investment.

China sees 120% rise in rail investment in first five months

• China saw a surge of investment in railway construction as the country pledged to increase spending as an effort to buoy the world's third largest economy.
• In the first five months, China pumped 168.9 billion yuan ($24.7 billion) in fixed-asset investment in railways, up 120% from a year earlier, the Ministry of Railways said in a statement Wednesday.
• The money included 149 billion yuan for railway infrastructure construction, up 161.8% from a year ago, 3.328 billion yuan for railway upgrading, and 16.55 billion yuan for purchasing trains, according to the ministry.

China Set to Grant Final Approval for First IPO Since September

• China’s securities regulator will grant final approval by tomorrow for the nation’s first initial public offering since September, two people familiar with the situation said.
• Guilin Sanjin Pharmaceutical, Zhejiang Wanma Cable and Shenzhen Salubris Pharmaceuticals are the three candidates for getting written permission to sell stock in Shenzhen, supposedly.
• “The securities regulator is still concerned about the benchmark’s performance,” said Sun Jian, a Shanghai-based analyst at Shenyin Wanguo Securities Co. “The market has been rising this week, which is an indication of sufficient liquidity and confidence.”

CIC goes on global hiring spree

• China Investment Corp (CIC), the country's $200 billion sovereign wealth fund, said it would start a new round of global hiring to support an expansion of its operations as it seeks new overseas investments.
• CIC, which currently employs about 200 people, will seek professional staff in 33 categories, including risk management, real estate, infrastructure, commodities and hedge fund investment, according to its website.
• "We are a new company, so it's natural for us to hire more people to grow," a CIC spokeswoman said. She declined to indicate the exact number of people CIC plans to hire.

China’s Stocks Rise to 11-Month High; ICBC, Shenhua Advance

• China’s stocks rose, driving the benchmark index to an 11-month high, after the World Bank raised its growth forecast for the country this year and Shenyin & Wanguo Securities Co. recommended buying machinery makers.
• Industrial & Commercial Bank of China Ltd., the nation’s biggest listed lender, rose +2.6% and China Shenhua Energy Co., the No. 1 coal producer, gained +5.5%.
• The country’s economy will expand 7.2% this year, up from a 6.5% forecast in March, the bank said. Sany Heavy Industry Co. climbed +4.9% after Shenyin & Wanguo said the company will benefit as property investment rebounds.

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	17,777	-307.94	-1.70%
Shanghai Composite	2,854	43.78	1.56%
Shenzhen Component	11,152	111.14	1.01%
TAIEX	6,145	-51.38	-0.83%
CNY/USD	6.8355	-0.0027	-0.04%

Source: China Economic Scan

18 June 2009 | China Economic Scan

18-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: Inflation said unlikely to occur in China in 2009, Hong Kong Q1 GNP/GDP down, CIC confirms financing deal with Australia's Goodman Group, UBS strategist speculates that US companies such as Coca Cola/GE/Walmart may seek Chinese listing, Chinese stocks get a boost on Wednesday.

Top 5 headlines

Economists: Inflation not likely to occur in China in 2009

• Concerns over possible inflation have shadowed the growth in bank credit, which continued to expand in May, with new loans reaching 664.5 billion yuan ($97.29 billion), according to the People's Bank of China (PBOC), the central bank, on June 12.
• About 49% of Chinese bankers thought the loans policy was a bit too "relaxed", an increase of 3.9 percentage points from the first quarter, while confidence in macro-economic growth prediction reached 39.1%, up 5 percentage points.
• "Deflation, instead of inflation, should be the major concern," said Yao Jingyuan, chief economist with the National Bureau of Statistics (NBS). "There is no need to be too worried about inflation, as commodities prices will remain low for the whole year," said Yao.

Hong Kong's first quarter GNP, GDP go down

• Hong Kong's gross national product (GNP) fell 9.2% in the first quarter over a year earlier, to 388.7 billion HK dollars (US$50.15 billion) at current market prices, Hong Kong Census and Statistics Department said.
• According to statistics from the department, Hong Kong's gross domestic product (GDP), estimated at 380.1 billion HK dollars (US$49.05 billion) at current market prices in the first quarter, fell 7.3% during the period.
• Compared with GDP, the value of the GNP was larger by 8.6 billion HK dollars (US$1.11 billion) in the first quarter, representing a net external factor income inflow of the same amount, and equivalent to 2.3% of GDP during the period.

CIC confirms financing deal with Goodman Group

• China Investment Corporation (CIC), the country's sovereign wealth fund, confirmed Wednesday that it will lend AU$200 million ($159 million) to Australia's leading property trust Goodman Group.
• CIC would commit to a financing facility alongside Macquarie Bank, Australia's biggest investment bank, said a source with CIC who declined to be named.
• Goodman Group is the third overseas company which CIC had chosen to invest in after buying stakes in Blackstone and Morgan Stanley since 2007.

Coca-Cola, GE, Wal-Mart May Seek China IPO, UBS Says

• Coca-Cola Co.,General Electric Co.Wal-Mart Stores Inc. are among U.S. companies that may seek to list on China’s stock exchanges, UBS AG said.
• John Tang, a Hong Kong-based UBS strategist, said he expects a dozen Western companies with a “strong presence” in China to offer shares in the yuan-denominated A-share market.
• “An A-share IPO allows foreign companies direct access to much needed renminbi funding,” Tang wrote in a note to clients. UBS declined a request for an interview.

China shares rise after Hu says stimulus working

• Chinese shares rebounded Wednesday after President Hu Jintao said Beijing's stimulus is showing results and China was determined to take the lead in emerging from the global economic crisis.
• Real estate stocks jumped, with China Vanke Ltd., the country's biggest developer, soaring 9.7% to 11.88 yuan, and rival Poly Real Estate Group up 8.2% to 25.52 yuan.
• Medical shares rose on speculation that the spread of the swine flu pandemic would drive sales. Da An Gene Co., a biotechnology company, surged 9% to 16.43 yuan, while Shenzhen Neptunus Bioengineering Co. rose by the daily 10% limit to 9.04 yuan.

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	18,085	-80.9	-0.45%
Shanghai Composite	2,810	34.1	1.23%
Shenzhen Component	11,040	243.29	2.25%
TAIEX	6,196	-24.90	-0.40%
CNY/USD	6.8382	0.0041	0.06%

Source: China Economic Scan

17 June 2009 | China Economic Scan

17-June-2009

China Economic Scan - Your daily update on the Chinese economy.

In this edition: China's fiscal revenue rises 4.8% in May, Microloans drive growth and change in rural China, Tencent CEO says still hopes to list yuan A shares, Everbright and Zunyi may be first to IPO following CSRC green light on new issues, Chinese stocks close down on Tuesday.

Top 5 headlines

China's fiscal revenue in May signals recovery

• An increase in China's fiscal revenue in May indicates a recovery in the economy and leave the government more room to employ fiscal measures to boost it, Tuesday's China Daily quoted experts.
• The country's fiscal revenue in May rose 4.8% year on year to 656.95 billion yuan ($96.05 billion), reversing the downward trend of the past few months, the Ministry of Finance (MOF) said yesterday.
• Aggregate central and local government revenues in the first five months stood at 2.71 trillion yuan, down 6.7% from a year earlier.

Wang Shulian’s Microloan Funds China Growth Impetus

• Microfinance provides small loans of a few thousand yuan to people in poverty who can’t get regular bank funding. Such programs have encouraged rural growth in countries including Bangladesh, where Nobel Peace Prize-winning economist Muhammad Yunus established Grameen Bank in the 1980s to extend loans to the poor.
• “Getting the money to trickle down” to the lowest level of the economy “is very, very important for the long-term development of China,” says Tammy Lam, who left her job as chief risk officer at Citibank last year to found Rural Impact Professionals, a nonprofit that fosters microcredit.
• “It’s really effective,” says Wang, 58, whose success encouraged her neighbors to get loans to raise sheep, expanding their village economy beyond subsistence farming. Many families now make at least several thousand yuan a year. Without the loans, “we’d still be poor,” she says.

Tencent CEO: Still Hope To List Yuan-Dominated A Shares

• Chinese Internet portal operator Tencent Holdings said the company still hopes to list yuan- denominated A shares in Shanghai. In March, the company said it had to drop its plans to list A shares because of poor market conditions.
• "Many domestic investors want to buy our shares and we want to allow our users to become our shareholders," Chairman and Chief Executive Ma Huateng told reporters Monday.
• Tencent said last month its net profit for the three months ended March 31 rose 94% to CNY1.05 billion from CNY542.0 million a year earlier.

Everbright, Zunyi May Lead China Share Sale Revival

• Everbright Securities Co., Zunyi Titanium Co. and Sichuan Expressway Co. may be among the first companies to sell shares publicly in China since September as the government prepares to reopen what was the world’s second- largest equity fundraising market in 2007.
• Everbright Securities, China’s 11th-biggest brokerage by assets, Zunyi Titanium and Sichuan Expressway are working on final documents required for regulatory approval to offer stock in Shanghai or Shenzhen, three people with knowledge of the matter said.
• “Current liquidity conditions can support share sales,” said Yi Yangfang, investment director at GF Fund Management Co. in Guangzhou, which manages about 78 billion yuan ($11.4 billion).

China Shares End Lower Led By Property Cos, Banks

• The benchmark Shanghai Composite Index, which tracks both A and B shares, ended down 0.5% at 2776.02. The Shenzhen Composite Index was flat at 916.55.
• Turnover for the Shanghai Composite Index slipped to CNY110.55 billion ($16.17 billion) from CNY111.43 billion Monday, which was down from CNY136.3 billion Friday. Analysts pointed to the shrinking turnover as a sign of investor cautiousness.
• Zhang Gang, an equity strategist at Central China Securities, said the Shanghai Composite Index will likely continue to consolidate around 2800 ahead of the resumption of initial public offerings, which may be later this month. "Until new IPOs are launched and people see how they're priced, uncertainty in the market will continue," he said.

Financial Indicators:

Metric

Value

Point change

% change

Hang Seng Index	18,166	-333.46	-1.80%
Shanghai Composite	2,776	-13.53	-0.49%
Shenzhen Component	10,797	28.24	0.26%
TAIEX	6,221	-4.75	-0.08%
CNY/USD	6.8341	-0.0069	-0.10%

Source: China Economic Scan