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China stocks end lower as Apple warning raises economic impact fears

The blue-chip CSI300 index closed 0.5 per cent lower.

ET Bureau|
Last Updated: Feb 18, 2020, 01.46 PM IST
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China stocks
The Shanghai Composite index was flat at 2,984.97.
China's blue-chip stocks ended lower on Tuesday as Apple warned that it was unlikely to meet its March quarter sales forecast as the coronavirus slowed production and weakened demand in China.

The blue-chip CSI300 index closed 0.5 per cent lower, with its financial sector sub-index shedding 1 per cent. The Shanghai Composite index was flat at 2,984.97.

Manufacturing facilities in China that produce Apple's iPhone and other electronics have begun to reopen, but they are ramping up more slowly than expected, Apple said. That will mean fewer iPhones available for sale around the world.

The number of new cases in mainland China fell below 2,000 on Tuesday for the first time since January, but the virus remains far from contained, as its economic impact spreads. South Korea has announced an economic emergency.

The impact of the coronavirus outbreak on China's various industries will mainly show up in February, a vice chairman of the country's state assets regulator said, as containment measures disrupt production and supply chains.

Bohai Securities warned that policymakers would be constrained by the risk of inflation. This comes on the heels of a recent rally after investors bet on policy support.

After a broad-based rally on Monday, it's very likely that performance of stocks in different industries would vary, the brokerage said in its note.

The tech-heavy start-up board index ChiNextP extended its climb to end 1.1 per cent higher, a more than three-year high. Investors expect China's continued stimulus to benefit those firms more.

Around the region, MSCI's Asia ex-Japan stock index was weaker by 1.04 per cent, while Japan's Nikkei index closed down 1.4 per cent. At 0720 GMT, the yuan was quoted at 7.0025 per U.S. dollar, 0.31 per cent weaker than the previous close of 6.9813.

Among shares, the largest percentage gainers on the main Shanghai Composite index were Shandong Jinjing Science & Technology Stock Co Ltd, up 10.1 per cent, and Shanghai Feilo Acoustics Co Ltd, gaining 10.06 per cent.

The largest percentage losers were Jiangsu Boxin Investing & Holdings Co Ltd down 10.01 per cent and Sino-Agri Leading Biosciences Co Ltd losing 8.26 per cent.

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