China’s stock benchmark slips but is flirting with 9-month highChina’s stock benchmark flirts with 9 month high – but Eastern Communications weighs it down

China’s stocks slipped on Tuesday, as concerns about more insider selling offset gains in nuclear-power equipment makers.

At the close, the Shanghai Composite Index was down 0.2 per cent, or 5.44 points, to 3,090.98, reversing an intraday gain of as much as 0.6 per cent that would have pushed the gauge to its highest close since June 7. Hong Kong’s Hang Seng Index rose for a fourth day.

Sentiment was dampened as Eastern Communications said its biggest shareholder plans to sell as much as a 2 per cent in the company in the coming six months. The maker of telecom equipment is one of the best-performing Chinese stocks this year, with its share price almost tripling.

An increasing number of corporate insiders are seizing the run-up in Chinese equities to cash out. This year, big shareholders of mainland traded companies have unveiled 870 plans to trim their holdings through the secondary market, which would amount to as much as 98.6 billion yuan (US$14.7 billion) in market cap, according to Securities Times.

That comes amid a huge run-up in Chinese markets this year. The Shanghai Composite Index, with gains of 24 per cent in 2019, is the world’s best-performing major benchmark.

“It’s natural to see the phenomenon after shares surge,” said Wu Kan, an investment manager at Soochow Securities in Shanghai. “But we cannot jump to an easy conclusion that that’s a signal of the end of the rally. Liquidity is ample and there should be more buyers in the market to counter the selling pressure.”