Chinese equities (CH55BN:US) traded in New York fell, extending last week’s steepest slump in the benchmark index since May, as renewed concern over Europe’s economy damped the outlook for the world’s biggest exporter.
The Bloomberg China-US Equity Index of the most-traded Chinese shares in the U.S. slid 0.6 percent to 96.16 yesterday, after sinking 4.2 percent last week. Technology stocks dropped, with Pactera Technology International Ltd. slipped 3 percent while Home Inns & Hotels Management Inc. (HMIN:US) led declines among tourism companies. Yingli Green Energy Holding Co. (YGE:US) drove solar stocks higher as Wacker Chemie AG boosted polysilicon output, citing growing demand from panel makers.
Concern over Europe’s debt crisis is reviving as finance ministers from the 17-member euro area meet in Brussels to discuss aid to Cyprus and Greece. China surpassed the U.S. to become the world’s biggest trading nation last year, official figures from both countries showed. Europe is China’s biggest export market, according to International Monetary Fund data.
“There still remains significant downside risk in global markets related to the Europe crisis,” Kevin Pollack, a managing director at Paragon Capital in New York, which invests in Chinese stocks, said by e-mail yesterday. “These issues have been temporarily swept to the side by investors. Markets are getting ahead of themselves given the serious issues that have yet to be fully resolved.”
Hong Kong’s stock market is closed for the first three days of this week for the Chinese New Year holiday, while trading in Shanghai will resume Feb. 18. The Hang Seng China Enterprises Index slumped 4.6 percent last week, while the Shanghai Composite Index of domestic Chinese shares added 0.6 percent in a second straight week of gains.
The iShares FTSE China 25 Index Fund, the largest Chinese exchange-traded fund (FXI:US) in the U.S., fell 0.2 percent to $39.77 in New York, after losing 4.7 percent last week. The Standard & Poor’s 500 Index was little changed at 1,517.01.
U.S. exports and imports of goods last year totaled $3.82 trillion, the U.S. Commerce Department said last week. China’s customs administration reported last month that the country’s trade in goods in 2012 amounted to $3.87 trillion.
Pactera, a provider of technology outsourcing services based in Dalian, China, sank to $7.48. The company is scheduled to report fourth-quarter earnings on Feb. 27.
Home Inns (HMIN:US), the largest operator of budget hotels in China, slid 1.7 percent to $31.27, the steepest slump in a month. The Shanghai-based company will report earnings on March 11, it said Feb. 6. Its competitor China Lodging Group Ltd. dipped 1 percent to $19.21 in its third day of declines, slipping the most this month. China Lodging plans to release fourth-quarter results on March 6.
Melco Crown Entertainment Ltd. (MPEL:US), which runs casino facilities in Macau, lost 1.9 percent to $20.48, retreating for the first time in three days. Ctrip.com International Ltd. (CTRP:US) fell 1.4 percent to a four-day low of $21.18.
Baoding, China-based Yingli, the world’s biggest silicon- based solar panel maker by capacity, jumped 5.5 percent to $3.26, the highest close since May 15. Suntech Power Holdings Co. advanced 4.8 percent to $1.52, rising the most in February.
Wacker Chemie, based in Munich, Germany, said in a statement yesterday it will increase output of polysilicon, the material used in solar cells, after sales exceeded forecast in January and as orders are outpacing production. Polysilicon prices rose above $16 per kilogram last week for the first time in three months, according to Bloomberg Industries.
Ambow Education Holding Ltd. (AMBO:US), a tutoring service provider based in Beijing, gained 3.7 percent to $1.4 in New York after dropping as much as 13 percent earlier in the day. The advance was the first in nine days.
Thirty-day volatility on the China-US gauge rose to 19.5 yesterday, the highest level since Dec. 10 and compared with an average of 18.1 over the past six months. The Bloomberg Chinese Reverse Mergers Index, which tracks a basket of companies that gained U.S. listings after buying firms that already trade, declined 0.2 percent to a one-week low of 79.32.
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