China's Stock Futures Drop as Xinhua Report Damps Stimulus Hopes - Bloomberg

By Bloomberg News - 2012-05-30T02:03:35Z

China’s stocks swung between gains and losses as the nation damped speculation of large-scale stimulus to revive economic growth.

Huaxin Cement Co. and Hebei Iron & Steel Co. declined among building-material makers. China Vanke Co., the nation’s biggest listed property developer, advanced 2.1 percent after JPMorgan Chase & Co. recommended buying real-estate stocks.

The Shanghai Composite Index (SHCOMP) rose less than 0.1 percent to 2,390.82 as of 10:01 a.m. local time after climbing to a two- week high yesterday. The CSI 300 Index (SHSZ300) rose 0.1 percent to 2,653.60. The nation has no plans to introduce stimulus measures on the scale deployed during the global financial crisis to counter this year’s economic slowdown, Xinhua News Agency reported yesterday.

“The Xinhua report may disappoint investors and put them in doubt whether the current scale of the stimulus plans will be enough to reverse the slowdown in economic growth,” said Wang Weijun, a strategist at Zheshang Securities Co. in Shanghai. “Whether these measures will work needs to be closely watched.”

The Bloomberg China-US 55 Index (CH55BN), the measure of the most- traded U.S.-listed Chinese companies, added 3.2 percent in New York. Chinese equities climbed yesterday amid signs the government is stepping up measures to bolster consumption. The nation rolled out a 4 trillion yuan ($630 billion) package in 2008 to help the economy battle the global financial crisis.

--Zhang Shidong. Editors: Darren Boey, Chan Tien Hin

To contact Bloomberg News staff for this story: Zhang Shidong in Shanghai at szhang5@bloomberg.net; Belinda Cao in New York at lcao4@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net