July 15, 2011 (Chinavestor) Chinese stocks lacked direction for the week and traded sideways on Friday after a mixed bag of news roiled markets world wide. The good news was China's latest GDP numbers that exceeded expectations and a swift move by Italy to calm markets after speculators questioned the third largest euro-zone economy's health. The bad news were manifold stemming from sluggish U.S. jobs growth and consumer spending to Greece's ills.
All told, the Hang Seng Index (INDEXHANGSENG:.HSI) slipped 64.8 points or 0.3% on Friday diving more than 650 points for the week. China Southern Airlines (HKG:1055) benefited from falling oil prices and soared 6.7% on Friday. Smaller rival China Eastern Airlines (HKG:0670) ended the week on a high note as well surging 2.8% for the day. Both airliners were among the best performing components of the 42 member Hang Seng Index (INDEXHANGSENG:.HSI). But the rest were mixed; industrial and resource players felt a pinch from slower global economic growth.
Investors on the Mainland focused on solid Chinese economic data and sent the Shanghai Composite Index (SHA:000001) 1.2% higher for the week. Resource stocks were among the best performers for the week; Aluminum Corp. of China (SHA:601600) and Western Mining (SHA:601168) ended the week on a high end.
Key Chinese ETFs fell on Thursday along the DJIA. Outlook for large caps is not the promising before the opening bell on Friday either. All but six components of the twenty five member Xinhua China 25 Index rose while the rest fell. This bodes ill for the most liquid Chinese ETF, the iShares FTSE/Xinhua 25 China Index (NYSE:FXI).
The sell-off was less universal among small caps as components of the Guggenheim China Small Cap ETF testifies. Stocks that fell outnumbered those that advanced two to one among 165 components of the index.