May 21, 2010 (Chinavestor) – Chinese stocks saw some relief on Friday as global equity markets moved higher on news that Germany approved its portion of the $1 trillion European bailout package. Oversold conditions across the globe also helped bring on some fresh buying, but it was hardly enough to end the week on a positive note.
Large-cap Chinese names were hammered on the week. Baidu (Nasdaq:BIDU) was down as much as down 10% before surging almost 6% on Friday. A strong move, but not enough for the Internet giant to finish the week in the green. Europe's debt crisis continued to weigh on the Euro and with oil prices tumbling, energy and materials names didn't see any relief until Friday. PetroChina (NYSE:PTR), the largest Chinese oil company, finished the week down almost 2%.
Low oil prices pressured solar stocks as JA Solar (Nasdaq:JASO) lost more than 17% on the week. Tumbling silver prices weighed on Silvercorp Metals (NYSE:SVM) as those shares shed almost 19%. Uninspiring earnings reports from China Nepstar Chain Drugstore (NYSE:NPD), Perfect World (Nasdaq:PWRD) and RINO International (Nasdaq:RINO) had all three of those names down at least 22%.
Weak earnings among new media stocks had investors selling-off shares of China Digital TV (NYSE:STV), which was down almost 22% on the week. Consumer products names didn't offer much shelter with a dour earnings report from Acorn International (NYSE:ATV) sending that stock tumbling 21%. Names tied to China's real estate market also suffered mightily with China Architectural Engineering (Nasdaq:CAEI) and China Housing and Land Development (NYSE:CHLN) both losing more than 18%.
Things weren't all bad on the earnings front, particularly in the telecom sector. China TechFaith Wireless (Nasdaq:CNTF) and Spreadtrum Communications (Nasdaq:SPRD) were bolstered by solid earnings reports, gaining 15% and 10.5%, respectively. Online media firm Sina (Nasdaq:SINA) also got a lift on decent profit numbers, gaining more than 1% for the week. Biopharma firm 3SBio (Nasdaq: SSRX) added 2% on slow news.
Global Sources (Nasdaq:GSOL) also gained about 1% due to a rosy earnings report. ChinaEdu (Nasdaq:CED), the for profit education provider, will report earnings on Tuesday, finished higher last week as buyers stepped in ahead of the earnings update. China Petroleum & Chemical (NYSE:SNP) was one commodities-related to shrug off the bearish trend in the group and finish the week higher, albeit only slightly.
Chinese stocks will certainly be in play this week as Federal Reserve Chairman Benjamin Bernanke, Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner visit Beijing. The Yuan will obviously be on the agenda, but it would be reasonable to expect Geithner to take a delicate approach regarding Yuan appreciation. Overnight on Sunday, the Shanghai Composite closed 3.5% higher, its best one-day performance since October, on news Beijing won't take further dramatic economic tightening measures.
The Shanghai Composite is still the third-worst performing index in the world this year behind bourses in Greece and Cyprus.