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China shares fall on weak property, Hong Kong also down

Wednesday, 19 March 2014 - 10:33am IST | Place: SHANGHAI/HONG KONG | Agency: Reuters

Chinese shares fell on Wednesday, dragged down by the property sector after the central bank denied it was part of talks about helping an ailing real-estate developer.

Problems at unlisted Zhejiang Xingrun Real Estate Co. are hurting Chinese property shares on the mainland and in Hong Kong.

By midday, the CSI300 of the largest Shanghai and Shenzhen A-share listings fell 1.6 percent, while the Shanghai Composite Index was down 0.9 percent at 2,2006.20 points.

The Hang Seng Index was down 0.2 percent at 21,549.49 points. The China Enterprises Index of the top Chinese listings in Hong Kong fell 0.3 percent.

In Hong Kong, many investors stayed on the sidelines ahead of a statement following a US Federal Reserve meeting, due early Thursday Asia time.

While there is concern about the risk of a default for a small developer, "the market has been overreacting to this news, because large developers like China Overseas and China Resources have also come down quite substantially," said Steven Leung, sales director at UOB Kay Hian in Hong Kong, adding that those companies don't face any difficulties.

On Wednesday, shares in Hong Kong-listed China Resources Land fell 1 percent and China Overseas Land and Investment was down 1.2 percent.

Shenzhen-listed property developer China Vanke fell 4 percent while Poly Real Estate declined 2.8 percent.

Luggage maker Samsonite shares jumped 10.6 percent after the company reported an 18.6 percent rise in its 2013 profit at $176.1 million.

Shares in Goodbaby International dropped 4.3 percent after the stroller-maker and distributor company reported 2013 profit fell 6.5 percent to HK$171.1 million ($22.03 million).

Internet giant Tencent stock dropped 2.3 percent ahead of 2013 earnings results as concerns remained over a crackdown on online payments by China's central bank.

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