Shanghai, Hong Kong Indexes Drop; China Trade Surplus Shrinks

Chandrasekhar Atreya
10 Jan, 2011
New York City

Shanghai stock indexes fell 1.6% and Hong Kong index fell 0.7% after trade surplus in December dropped. China reported a less-than-expected trade surplus in December 2010 at $13.1 billion. Ford Motor unit in China sold 52% more vehicles in December at 56,880 units.

[R]5:00 PM Hong Kong, China – Shanghai stock indexes fell 1.6% and Hong Kong index fell 0.7% after trade surplus in December dropped. China reported a less-than-expected trade surplus in December 2010 at $13.1 billion. Ford Motor unit in China sold 52% more vehicles in December at 56,880 units.[/R]

Shanghai stocks dropped after China reported a sharp drop in trade surplus for December and the year 2010. The benchmark stock index in Hong Kong also fell on mainland concerns.

The Shanghai Composite Index lost 1.64% or 46.42 to close at 2,792.38 and CSI 300 Index dropped 1.82% or 57.63 to close at 3,108.99.

The Hang Seng Index in Hong Kong fell 0.69% or 164.04 to close at 23,522.59.

China reported a less-than-expected $13.1 billion trade surplus for December ahead of the scheduled meeting with President Obama on January 19, when he is likely to press for more gains in the yuan.

Exports climbed 17.9% to $154.2 billion from a year earlier month and imports surged 25.6% to $141.1 billion, the Customs Bureau said on its Web site today.

Shanghai Municipal government and China’s Ministry of Commerce signed an agreement on Sunday to build a new exhibition hub in Hongqiao area as part of the city’s plan to become the world’s leading international trading center.

The project likely to come up in an area of 1.04 square kilometers, consisting of exhibition halls, logistic facilities and other amenities will be built by a joint venture between Shanghai Expo Group and China Foreign Trade Center.

State Grid Corp of China plans to build more electric charging stations in Beijing and other cities in 2011 to meet rising demand for electric vehicles, a Beijing newspaper reported on Saturday.

The country’s dominant electric power transmission company will build a network of charging stations in Beijing, Tianjin, Hefei and Nanchang this year, the Beijing News quoted SGCC general Manager Liu Zhenya as saying.

China’s Nasdaq-styled Growth Enterprise Market saw 153 start-ups which raised 116.75 billion yuan, by the end of 2010 as the country resorted to the capital market to shore up the advantages of innovative industries, the Chairman of the country’s top securities watchdog said.

Ford Motor China sold 56,880 units in December 2010, up 52% from December 2009 and bringing the total sales in 2010 to 582,467 units, up 40% from 2009.

Changan Ford, the passenger vehicle joint venture of Ford in China, sold 403,283 units in 2010, an increase of 34% from 2009.

Southwest China’s Chongqing Municipality could be one of the first Chinese cities to impose a housing property tax, if an ongoing local parliamentary session approves a government work report delivered by Mayor Huang Qifan.

Members of the municipal people’s congress were reviewing the government report that looks to impose a tax on high-end houses at their meeting on Sunday, the Xinhua news agency reported.

Pakistani Prime Minister Yousuf Raza Gilani underlined on Sunday the need for doubling its trade with China from the current $7 billion to $15 billion in “the shortest possible time.”

He was addressing a visiting 100-member Chinese youth delegation when he said 36 projects have been identified for the next Pakistan-China Five Year Development Program 2012-2016.

Stock Movers

Drug companies led the decliners with Jiangsu Hengrui Medicine Co dropping 5.36% to 53.00 yuan and Yunnan Baiyao Group Co 1.45% to to 57.65 yuan.

Financial shares and developers pared Friday’s gains especially with housing prices for December and the full year due this week.

China Merchants Property Development Co lost 3.58% to 17.23 yuan and Industrial and Commercial Bank of China 1.4% to 4.24 yuan.