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China stocks post worst day in three months, but up for the week
March 17, 2017 / 7:28 AM / 6 months ago

China stocks post worst day in three months, but up for the week

SHANGHAI, March 17 (Reuters) - China’s main stock indexes fell on Friday, posting their worst day since last December, as investors await fresh evidence of a sustainable recovery in the world’s second-largest economy.

The blue-chip CSI300 index and the Shanghai Composite Index both lost around 1 percent to 3,445.81 points and 3,237.45 points, respectively.

For the week, the CSI was up 0.5 percent, while the SSEC gained 0.8 percent.

China’s central bank on Thursday raised short-term interest rates in what economists said was a bid to stave off capital outflows and keep the yuan currency stable after the raised U.S. rates overnight.

The central bank tried to soothe jitters by saying the interbank rate increase did not point to any change in its monetary policies and was not tantamount to a hike in its benchmark policy rate.

But analysts said the rate moves, more of which are expected, will eventually translate into higher borrowing costs for Chinese companies and consumers.

For the day, most sectors lost ground, dragged down by material plays and by banking stocks, as higher borrowing costs typically pressure rate-sensitive sectors such as property and banking.

In particular, investors retreated from newly-listed stocks, many of which slumped after surging in past weeks on speculative buying.

Still, shares in Baiyin Nonferrous closed up 1.6 percent in volatile trading.

The stock has surpassed China Molybdenum to become the largest listed nonferrous company by market value, after rocketing 574 percent since its debut trading in mid-February. (Reporting by Luoyan Liu and John Ruwitch; Editing by Kim Coghill)

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