China stocks edged up on Friday, as strength in consumer and tech shares offset a slump in resources plays, but major indexes posted their biggest weekly decline in three months. Reversing initial losses, the bluechip CSI300 index rose 0.5 percent, to 3,174.90 at the end of the session, while the Shanghai Composite Index gained 0.2 percent, to 2,959.24 points. For the week, CSI300 fell 3 percent, while SSEC lost 3.9 percent, the worst weekly performance since late January.
China's stock market has become increasingly volatile in recent weeks as a seven-week rebound loses steam. An index tracking the resources sector slumped 2.7 percent on Friday, as shares of steelmakers, gold miners and copper producers tumbled.
The sell-off in the sector was triggered by regulators' move to cool frenzied commodities trading recently, with China's three futures exchanges announcing late on Thursday that they would increase transaction fees. Hong Kong shares also weakened, tracking regional markets, after Wall Street suffered its first loss in four sessions amid disappointing earnings from US bluechip companies. China's bluechip CSI300 index fell 0.2 percent, to 3,153.65 points by lunch break, while the Shanghai Composite Index lost 0.6 percent, to 2,935.35 points.
China's stock market has become increasingly volatile in recent weeks as a seven-week rebound loses steam. Lu Jie, head of China research at Robeco Asia Investment Center, attributed the rising volatility to fragile investor confidence. "It's still very much a game between existing players. Fresh money is not coming in," Lu said. "Investors would race to take profit from any rebound, fearing they would be late in coming out."
Barring a sharp reversal in afternoon trading, both indexes are poised to have their worst week since the end of January. Sentiment in China was soured by a 3.5 percent slump in the resources sector. Shares of steelmakers, gold miners and copper producers tumbled after China's three futures exchanges announced late on Thursday that they would increase transaction costs to curb speculation in commodities trading.
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