Agriculture sector scores as markets diverge

Stock benchmarks on the Chinese mainland ended on opposite sides of the fence Thursday as securities and property shares slipped in late trading.

The Shanghai Composite Index dropped 1.88 points, or 0.09 percent, to close at 2,044.89; while the Shenzhen Component Index managed to climb 18.77 points, or 0.23 percent, to finish at 8,114.87. Indices tracking the small- and medium-sized enterprise (SME) and ChiNext boards inched up by 1 percent and 0.87 percent respectively on the day.

Combined turnover at the country's two exchanges eased to 169.3 billion yuan ($27.66 billion). down from Wednesday's 210.9 billion yuan.

The pharmaceutical, agricultural and travel sectors had a banner day Thursday as their components surged by averages of 1.6 percent, 2.13 percent and 0.59 percent respectively.

Xinjiang Talimu Agriculture Development Co Ltd hit the 10 percent ceiling to end at 5.83 yuan; while Gansu Yasheng Industrial Group Co Ltd and Hunan Jinjian Cereals Industry Co Ltd gained over 3 percent to close at 7.50 yuan and 4.55 yuan respectively.

Analysts say that agricultural stocks spiked as investors saw them as being undervalued compared with other consumer staple equities.

On the downside, securities and property development shares were among the biggest laggards. Sealand Securities Co Ltd shed 1.99 percent to 12.80 yuan, while Southwest Securities Co Ltd tumbled by 1.89 percent to 8.82 yuan. China Vanke Co Ltd gave up 1.9 percent to 9.79 yuan, and Gemdale Corporations fell 1.66 percent to 7.11 yuan.

July trade data from Chinese customs authorities showed exports rising 5.1 percent year-on-year to 1.15 trillion yuan for the month, while imports increased by 10.9 percent to 1.04 trillion yuan. Li Daxiao, research director at Yingda Securities Co, said that the better-than-expected import tally indicates that raw material demand is on the rise, a trend that is good news for the stock market.