Chinese shares ended 0.81 percent lower on Thursday as investors took profits in blue chips before flag carrier Air China's listing on Friday.
Air China Ltd will list with an initial public offer price of 2.80 yuan, and although the downsizing of its offer and its pledge to buy back shares if they fall below the IPO price may prevent the stock falling on Friday, it is not expected to perform well.
Air China's H-shares in Hong Kong closed at HK$2.79 on Thursday, which means the A-shares will list in Shanghai at a discount of just 2 percent - not enough for many local investors.
"Air China isn't expected to have a strong performance after the flood of new listings since June. The timing is unfortunate and the industry is vulnerable to rising oil prices," said Cao Jianming, analyst at Orient Securities.
The benchmark Shanghai composite index closed at 1,603.332 points. Turnover in Shanghai A-shares was a tiny 12.1 billion yuan, down from 15.2 billion yuan on Wednesday.
A sluggish debut by Air China has been expected for so long that it would probably not affect the overall market much, but it could dampen some recent listings such as Bank of China, which fell 0.9 percent to 3.29 yuan on Thursday.
The stock market regulator said it would resume reviewing IPO applications next week after a nearly three-week pause. But the three companies it will review are small so the news did not have a major impact on the market, which is more concerned about the drain on liquidity from big listings expected later this year, such as ICBC.
Comments
Comments are closed.