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China stocks pare losses over S&P move and N.Korea, end week little changed
September 22, 2017 / 7:18 AM / a month ago

China stocks pare losses over S&P move and N.Korea, end week little changed

SHANGHAI, Sept 22 (Reuters) - China stocks on Friday recouped most of their early losses as investors played down S&P’s downgrade of China’s sovereign rating and North Korea’s threat of another nuclear test.

Investors appear to expect that Beijing will maintain stability in financial markets ahead of a key party congress that begins on Oct. 18.

On Friday, the blue-chip CSI300 index was unchanged at 3,837.73 points, while the Shanghai Composite Index shed 0.2 percent to 3,352.53 points.

For the week, CSI300 added 0.2 percent, while SSEC was flat. The two indexes have been trading in narrow ranges in recent weeks.

“Investor confidence is battered by a slew of bad news, at least in the short term,” said Fan Wenjie, head of the overseas investment department of Shanghai Kaiyuan Group, a conglomerate.

“And the Fed tightening plan may be prodding some investors to adjust their portfolio and buy more dollar assets.”

For some, confidence was dented by S&P’s one-notch China downgrade to A+ from AA-, with the rating agency saying “a prolonged period of strong credit growth has increased China’s economic and financial risks.”

For the week, investors dumped resource shares on fears a stronger dollar could hit commodity prices, with an index tracking major material firms losing 2 percent.

Real estate firms also dragged with a 2.4 percent weekly loss, as more cities joined Beijing in hiking mortgage rates for home buyers. (Reporting by Luoyan Liu and John Ruwitch; Editing by Richard Borsuk)

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