Defense and securities stocks drag markets lower
China’s A-share markets ended lower on Wednesday, with most sectors posting losses.
Buoyed by overnight rallies of US stocks, A-shares opened higher during the morning session but moved into negative territory later.
The benchmark Shanghai Composite Index fell by 0.32 percent, or 8.88 points to finish at 2,768.68.
The smaller Shenzhen Component Index declined by 0.50 percent to 8,814.74 points, while the ChiNext Index edged down 0.51 percent to finish at 1,500.25 points.
The combined turnover of the two bourses came to 376.3 billion yuan (US$53.11 billion), down from the previous trading day’s volume of 523.6 billion yuan.
Defense and securities brokerage stocks led the losses. Shares of Guangzhou Hangxin Aviation Technology Co Ltd, a company delivering technical solutions in the field of aircraft engineering and safety, shed 6.12 percent to stand at 17.04 yuan a share.
Conversely, gold shares posted strong gains. Gold was changing hands at around US$1,495 per ounce on Wednesday midday Asia time, hitting to a more than six year high.
As investors are taking a “risk-off” approach to their portfolios amid global economic uncertainties, the price of gold has been upward since June.
Gold will maintain its strength for at least the next six to 12 months, according to an economist from Overseas-Chinese Banking Corporation.
On Wednesday, the People’s Bank of China set the official midpoint reference for the yuan at 6.9996 per dollar, slightly weaker than market expectations. The central bank allows the exchange rate to rise or fall 2 percent from that number.