...

China Stocks Rise as Liquor Firms Surge to Offset Power-Cut Woes




  • In Business
  • 2021-09-27 04:11:41Z
  • By Bloomberg

(Bloomberg) -- Shares of Chinese liquor makers drove advances in the mainland market, even as materials stocks fall due to concerns over power curbs that have hurt large swathes of manufacturing in the country.

Most Read from Bloomberg

  • How Los Angeles Became the City of Dingbats

  • School Reopenings Falter as U.S. Kids Near 1 Million Covid Cases

  • The Rise of the Pandemic Dashboard

  • A Jewish Tradition Makes Room for Unconventional Design

  • Berlin Referendum Could Determine the Future of the City's Housing

Liquor giant Kweichow Moutai Co. climbed as much as 10% while Luzhou Laojiao Co. also soared by the daily limit. The CSI 300 Consumer Staple Index jumped as much as 8.4%, set for the best day since 2008.

Pledges by Moutai's new chairman Ding Xiongjun at a Friday shareholders' meeting on long-term reforms, such as changes in distribution channels and pricing, should boost the prospects of rising selling prices as well as volumes, Sinolink Securities Co. analysts including Liu Chenqian wrote in a note. They expected an "acceleration period in earnings" next year and in 2023.

Ding said Moutai will focus on its main business and push for reforms in corporate governance, asset management as well as marketing and price systems, according to a statement posted on the company's official WeChat account.

Material stocks, however, were the leading losers in the benchmark on Monday as many provinces in the country continue to struggle to supply electricity to factories and even households. Inner Mongolia BaoTou Steel Union Co. and China Northern Rare Earth Group High-Tech Co. were among the biggest drags on the index, each tumbling by the daily limit.

The CSI 300 Index rose as much as 1.5%, with more than half of the 10 top performers being alcohol producers.

The rebound in liquor stocks follows months of selloffs in the shares due to high valuations as investors rotated into other sectors such as energy and utilities. The consumer staple subgauge of the CSI 300 index was still down around 30% from a February high despite Monday's spike, the worst among all sectors.

In Hong Kong, shares tied to cryptocurrencies also trended lower after China banned transactions and vowed to root out mining of digital assets. Huobi Technology Holdings, which started one of the world's largest Bitcoin exchanges about seven years ago, sank as much as 33%, the most ever.

High-yield Chinese developers listed in the city also fell after Sunac China Holdings Ltd. sought help from a local government in the eastern province of Zhejiang, the latest sign that the nation's property slowdown and the crisis at Evergrande are weighing on builders. Sunac China shares slid as much as 6.4% while distressed Guangzhou R&F Properties Co. dropped 4.8%.

(Adds declines in shares of cryptocurrency-related firms and high-yield Chinese developers in the eighth and ninth paragraphs.)

©2021 Bloomberg L.P.

COMMENTS

More Related News

Stocks Set for Steady Start; Dollar Stays Lower: Markets Wrap
Stocks Set for Steady Start; Dollar Stays Lower: Markets Wrap

(Bloomberg) -- Asian stocks looked set for a steady start Thursday after a mixed Wall Street session, as investors weighed corporate earnings, elevated...

Brazil Stocks Hit World
Brazil Stocks Hit World's Bottom as Bolsonaro Spooks Markets

(Bloomberg) -- Brazil stocks have become the world's worst-performing so far this year, hit by a combination of sluggish growth, higher rates and fears...

Fed
Fed's Quarles Urges November Taper and Warns of Inflation Risks

(Bloomberg) -- Federal Reserve Governor Randal Quarles said he favors an initial move to slow monetary stimulus next month and is concerned by a broadening...

PayPal
PayPal's Pinterest Pursuit Set to Tip 2021 Into Record M&A Year

(Bloomberg) -- PayPal Holdings Inc.'s pursuit of social media company Pinterest Inc. is poised to push 2021 over the line to become the busiest-ever year for...

Icahn Calls on Southwest Gas to Sell Its Construction Unit
Icahn Calls on Southwest Gas to Sell Its Construction Unit

(Bloomberg) -- Activist investor Carl Icahn is ratcheting up the pressure on Southwest Gas Holdings Inc., calling on the utility company to sell its Centuri ...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business