SMIC Slumps as PMI Trims Quarterly Gain: China Overnight

Chinese stocks declined in New York, paring the gauge’s best quarterly gain in three years, after a lower-than-estimated reading in a manufacturing index spurred concern economic growth is slowing.

The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. slid 0.6 percent to 101.46. Computer chip foundry Semiconductor Manufacturing International Corp. slipped to a five-month low and Yanzhou Coal Mining Co. traded at the largest discount since June to its Hong Kong stock after Standard & Poor’s cut its rating to junk. Bona Film Group Ltd. rallied after saying Fosun International Ltd. will buy a stake.

The slump cut a three-month advance in the China-US gauge to 18 percent, still the best quarterly performance since 2010. The Purchasing Managers’ Index for China from HSBC Holdings Plc and Markit Economics rose to 50.2 in September, less than the

51.2 median estimate in a Bloomberg News survey. The U.S. stalemate over the federal budget, which increased the likelihood of a government shutdown, helped cause a rout in emerging-market equities.

“A lot of local investors I spoke to are concerned that growth will start to decelerate again, like what we saw with the HSBC PMI today,” Michael Wang, an emerging-markets strategist at Amiya Capital LLP in London, said by e-mail yesterday. “People are also selling for profits after the big bounce in Chinese equities as the U.S. budget dilemma are causing volatilities.”

ETF Sinks

The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., sank 1.5 percent to $37.08 in a fifth day of declines, paring its gain last quarter to 14 percent. The Standard & Poor’s 500 Index retreated 0.6 percent, for a quarterly rally of 4.7 percent.

SMIC, as the Shanghai-based semiconductor maker is known, slumped 1.1 percent to $3.47 in New York, the lowest close since April.

Phoenix New Media Ltd., a Beijing-based TV and Internet news outlet, slid 3.8 percent to $11.25, paring its advance over the past three months to 105 percent, the biggest quarterly gain since its U.S. listing in May 2011.

Yanzhou coal, the country’s fourth-largest producer of the fuel, sank 2.5 percent to $9.56.

S&P cut Yanzhou’s credit rating to BB+ from BBB-, saying the company will continue to have a “weak” financial position in the next 12-18 months due to “subdued coal prices and still high leverage,” Jian Cheng, a Hong Kong-based analyst at the rating company said in a report yesterday.

Solar Surge

Bona Film’s ADRs advanced 2.1 percent to a six-week high of $5.25.

The Beijing-based company said Fosun and its units will buy 2 million of Bona’s shares, representing a 6.4 percent stake, at an average price of $5.20 per ADR. Fosun will purchase the shares from Bona’s existing shareholders, it said in a statement yesterday.

Suntech Power Holdings Co., a solar-panel maker which was forced into bankruptcy in March by local banks, surged 26 percent to $1.70, the highest close since February. LDK Solar Co., based in Xinyu, China, jumped 30 percent to $1.93, rallying the most since 2009.

China will rebate 50 percent of value-added tax payments to taxpayers who sell self-produced solar-powered electricity, according to a statement dated Sept. 23 which was posted yesterday on the Ministry of Finance’s website. The policy will be effective today through Dec. 31, 2015, the ministry said.

Qunar Cayman Islands Ltd., an online travel service company in which Baidu Inc. has a controlling stake, filed yesterday to sell $125 million of shares on the New York Stock Exchange.

The Hang Seng China Enterprises Index dropped 1.7 percent to 10,316.12, sliding the most in a month. The gauge increased 11 percent for the quarter. The Shanghai Composite Index added

0.7 percent to a one-week high of 2,174.67, increasing 9.9 percent for the quarter. The markets in Shanghai and Hong Kong will be closed today for the National Day holiday.

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