At close of trade, the benchmark Shanghai Composite Index rose marginal 0.07%, or 2.26 points, to 3,214.50. The Shenzhen Composite Index, which tracks stocks on China's second exchange, fell 0.82%, or 17.23 points, to 2,096.50. The blue-chip CSI300 index sank 0.63%, or 26.11 points, to 4,148.46.
Investors are cautious about economic growth pressure from the further spread of Covid resurgence and the strict measures that could follow to contain the virus. The partial lock down in Shanghai and the potential spread out into other regions will make it even harder for China to achieve the 5.5% GDP growth target, considering this year's weak starting point.
China's zero-tolerance approach to the virus is putting pressure on growth, even as authorities pledged strong support for the economy and markets via a slew of initiatives earlier this month.
Lockdowns add uncertainties to the outlook for Chinese equities, with investors already grappling with regulatory headwinds including a potential delisting of domestic firms from American exchanges, and the fallout from the war in Ukraine.
ECONOMIC NEWS: China Industrial Profits Up 5% On Year in First two Months - China industrial profits rose 5% in the January-February period from a year earlier, the National Bureau of Statistics said Sunday. That compares with a 4.2% increase in the single-month data for December. Profits at state-owned industrial firms grew 16.7% while those at private-sector fell 1.7%, amid production challenges due to COVID-19 outbreaks. Besides, uncertainty over global supply chains due to the war in Ukraine and the potential for even higher commodity and energy prices may weigh on the bottom-line of Chinese firms.
CURRENCY NEWS: China's yuan was little changed against the U.S. dollar on Monday after tad firmer mid-point fixing by central bank. Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate CNY=PBOC at 6.3732 per dollar prior, firmer than Friday's fix of 6.3739. In the spot market, the yuan CNY=CFXS weakened to 6.3748 late afternoon, 0.13% softer than Friday's late session close.
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