October 31, 2018 / 7:26 AM / 19 days ago

China shares end higher after bruising October

HONG KONG/SHANGHAI, Oct 31 (Reuters) - Stocks in China closed higher on Wednesday amid rising investor optimism after authorities this week pledged support for markets, but the country’s main indexes fell sharply for the month while new manufacturing data pointed to weakness ahead.

** At the close of trade, the Shanghai Composite index was 1.4 percent higher at 2,602.78 points. The index fell 7.7 percent for the month, its biggest monthly drop since June. ** The blue-chip CSI300 index ended 1.4 higher, but is down 8.3 percent for the month, its worst monthly performance since January 2016. ** The CSI financial sector sub-index ended 0.29 percent higher, the consumer staples sector rose 3.83 percent, the real estate index gained 1.32 percent and the healthcare sub-index finished up 3.15 percent. ** Analysts attributed Wednesday’s rise to the Chinese securities regulator’s promise on Tuesday that it will improve market liquidity, encourage share buybacks and mergers and acquisitions. ** “This won’t bring about new capital immediately,” said Zhang Qi, a Shanghai-based analyst at Haitong Securities. “But the policy signals of supporting the stock market are very clear, and the markets are reacting.” ** Investors paid less attention to PMI data, which indicated that China’s manufacturing growth in October was at its weakest pace in over two years and showed a deepening slump in export orders. ** “We’ve had a long period of selling, the market is numb to this sort of news,” said Cao Xuefeng, head of research at Huaxi Securities. “Most people have been expecting it to be lower than before. Even though PMI is weaker, it is still above 50, which is where most people expected it to be.” ** The smaller Shenzhen index ended up 1.39 percent and the start-up board ChiNext Composite index was higher by 1.24 percent. ** Shares in Hong Kong were set for a sixth consecutive month of losses. The Hang Seng has only fallen for six straight months once before, matching an equally long streak of monthly losses in 1982. The Hang Seng index is 1.2 percent higher. ** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.11 percent while Japan’s Nikkei index closed 2.16 percent higher. ** At 07:15 GMT, the yuan was quoted at 6.9691 per U.S. dollar, 0.02 percent weaker than the previous close of 6.9675. ** The largest percentage gainers in the main Shanghai Composite index were Routon Electronic Co Ltd, up 10.15 percent, followed by Changchun Sinoenergy Corp, gaining 10.12 percent and Sichuan Em Technology Co Ltd , up by 10.12 percent. ** The largest percentage losers in the Shanghai index were Zhejiang Hugeleaf Co Ltd down 10.09 percent, followed by Zhejiang Qianjiang Biochemical Co Ltd losing 10.03 percent and Anhui Andeli Department Store Co Ltd down by 9.99 percent. ** So far this year, the Shanghai stock index is down 21.3 percent, the CSI300 has fallen 21.8 percent while China’s H-share index listed in Hong Kong is down 13.6 percent. Shanghai stocks have declined 7.75 percent this month. ** About 18.06 billion shares were traded on the Shanghai exchange, roughly 132.7 percent of the market’s 30-day moving average of 13.61 billion shares a day. The volume in the previous trading session was 16.67 billion. ** As of 07:15 GMT, China’s A-shares were trading at a premium of 23.84 percent over the Hong Kong-listed H-shares. ** The Shanghai stock index is below its 50-day and 200-day moving averages. ** The price-to-earnings ratio of the Shanghai index was 10.93 as of the last full trading day while the dividend yield was 2.9 percent. ** So far this week, the market capitalisation of the Shanghai stock index has fallen by 1.18 percent to 27.43 trillion yuan. (Reporting by Noah Sin and Andrew Galbraith; Editing by Vyas Mohan)

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