Stocks fall after Caixin service PMI dips to 4-month low

Shanghai stocks fell yesterday, dragged down by telecom and steel shares.

The Shanghai Composite Index lost 0.18 percent to 3,131.11 points.

Investors turned cautious after Caixin service PMI dipped to a four-month low in March. The Caixin China General Services Purchasing Managers’ Index fell to 52.3 in March from February’s 54.2, according to a survey conducted by financial information service provider Markit and sponsored by Caixin Media.

Caixin said new business expanded at a slower rate and employment trends in the service sector deteriorated last month, pointing to cooling demand.

“Service companies’ expectations of business activity over the next 12 months declined to the lowest reading since September, suggesting that weak demand had affected confidence,” said Zhong Zhengsheng, director of macro-economic analysis at CEBM Group, a subsidiary of Caixin Insight Group.

Shares of telecom firms and steelmakers were among the biggest decliners yesterday. Telecom shares lost 1.93 percent and steelmakers fell 1.63 percent, according to financial information provider Tonghuashun.

Guangdong Super Telecom Co slumped 4.13 percent to 43.13 yuan (US$6.85), Routon Electronic Co lost 3.16 percent to 5.82 yuan, and Hainan Mining Co fell 1.56 percent to 7.55 yuan.