China stocks subdued as consumer gains counter losses in drugmakers

Reuters2021-06-24

SHANGHAI, June 24 (Reuters) - China shares ended slightly higher on Thursday, as gains in consumer and new energy companies countered losses in healthcare companies, which were hit by worries of a slump in drug prices.

** The blue-chip CSI300 index gained 0.2% at 5,155.97, while the Shanghai Composite Index was unchanged at 3,566.65.

** The CSI300 healthcare index led declines, with a 1.7% fall, after price plunges were shown in the results of the fifth national government-backed drug bulk-buy program.

* The average price cut was 56% among the 251 products for 61 types of medicines included in the list of preliminary bid winners, state news agency Xinhua said in a report.

** Drugmaker Hengrui , Asymchem Laboratories Tianjin Co Ltd and Bloomage Biotechnology Corp Ltd fell between 4.4% and 5.5%.

** Investors need to pay more attention to drugmakers' overall strength given a normalised bulk-buy mechanism, TF Securities said in a report, adding that bigger-than-expected price declines would be a risk for firms going forward.

** Helping the market, the CSI300 consumer staples index and the CSI new energy index rose 0.9% and 0.8%, respectively.

** China's monthly producer price index (PPI) is likely to rise 10% in June, piling pressure on downstream consumers, a senior official of China's banking and insurance watchdog told a forum in Beijing on Thursday.

** The Biden administration ordered a ban on U.S. imports of a key solar panel material from Chinese-based Hoshine Silicon Industry Co over forced labour allegations, said two sources briefed on the matter.

** Hoshine Silicon closed down 7.2% after the ban.

** The pricing department of China's National Development and Reform Commission (NDRC) and the country's market regulator have sent teams to various Chinese provinces and cities to investigate bulk commodity prices and supplies.

** The A-share resource industries index slipped 0.3% after the news.

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