October 31, 2011 (Chinavestor) Chinese stocks succumbed to profit taking on the last week of October. The Hang Seng index (INDEXHANGSENG:.HSI) shed 154.4 points or 0.8% on Monday but is still ahead 12.9% for all of October. Warren Buffet backed BYD company (HKG:1211) surged 8.6% to end the month on a high note. The stock rose 45% in October but even with that is trading over 50% lower YTD. Low beta, low risk China Unicom (HKG:0762) advanced along with China Life insurance (HKG:2628), but most components of the index fell.
Stocks lacked direction on the mainland as well. The Shanghai Composite index (SHA:000001) shed 5.2 points or 0.2% after Wen Jiabao, China's premier, cooled expectations to end fiscal tightening anytime soon. Most components of the index fell as investors digested global, mostly European, economic news.
Most components of the Xinhua China 25 Index fell, boding ill for the iShares FTSE/Xinhua China 25 Index (NYSE:FXI) ahead the bell. Chinese telecom stocks proved to be defensive again but resource, basic material and financial stocks fell.
Chinese technology stocks rallied last Friday on the back of Baidu's strong earnings. China's largest internet company reported record numbers last week, sending smaller technology stocks, like E-Commerce (NYSE:DANG) and RenRen (NYSE:RENN), soaring. But that may change as Sohu.com Inc. (NASDAQ:SOHU) reported before the open and is trading significantly lower in pre-market hours.