China stocks fall

Chinas main stock index edged down on Friday, again underperforming regional markets, as investors fretted about mixed economic data and the likelihood of weak corporate earnings for the first quarter. The Shanghai Composite Index hit a high of 2,166.022 points in the morning but closed 0.24 percent lower at 2,128.848 points. Turnover was near a seven-week low.
This greatly underperformed Hong Kongs Hang Seng Index, which rose nearly 4 percent after a smaller-than-expected decline in US retail sales and on hopes that the largest US banks would survive without a government take-over. Turnover in Shanghai A shares was 70.9 billion yuan ($10.4 billion), near a seven-week low, against Thursdays 70.7 billion. Losing Shanghai A shares outnumbered gainers by 646 to 278.
In a speech marking the end of the annual session of parliament, Premier Wen Jiabao expressed confidence in an economic recovery and said China could launch new economic stimulus policies at any time. But he did not announce immediate, fresh steps to aid the economy. That left investors worrying about this weeks economic data; money supply growth, bank loans and fixed asset investment were strong, fuelling hopes for an early recovery, but exports and industrial investment slumped more steeply than expected, raising doubts about the strength and sustainability of the recovery.
Bank shares were mixed, narrowing or even erasing their premiums to Hong Kong-listed H shares. Industrial & Commercial Bank of Chinas A shares were flat at 3.68 yuan while its H shares gained 4.70 percent to HK$3.34. The average premium of A shares over H shares in the same companies dropped sharply from above 60 percent this week, but it remains uncomfortably high for some investors at 46 percent.
Shares related to the southern Chinese sity of Zhuhai surged after Wen said financing issues involving construction of a huge bridge linking Hong Kong, Macau and Zhuhai had been resolved, and that work would start this year. Previously, Hong Kong Chief Executive Donald Tsang had said construction would start in 2010.
Guandong Shirong Zhaoye, a Zhuhai property firm, soared its 10 percent daily limit to 7.85 yuan. CITIC Securities slipped 1.71 percent to 21.30 yuan after saying China Life Insurance Co and China Lifes parent company had cut their combined stake in the brokerage to 12.32 percent from 17.32 percent.