Chinese share prices were sharply lower Thursday, with blue
chips sinking and losers far outnumbering gainers, on concern that
the central bank might raise interest rates again over the coming
weekend.
The benchmark Shanghai Composite Index, which includes A and B
shares, plunged 2.7 percent, or 137.50 points, to close at 4,958.04
points. The intra-day low was 4,954.36 points.
The Shenzhen Component Index on the smaller Shenzhen Stock
Exchange ended at 16,035.19 points, down 4.73 percent, or 796.38
points.
Losses outnumbered gains by 729 to 86 in Shanghai and 557 to 92
in Shenzhen.
The combined turnover of the two bourses dropped to 156.98
billion yuan (about 21.3 billion U.S. dollars) from Wednesday's
164.46 billion yuan.
Zhou Xiaochuan, governor of the People's Bank of China (PBOC),
China's central bank, recently said that the bank was studying the
possible effect of further interest rate hikes against surging
consumer prices. The PBOC has raised rates five times so far this
year.
Property shares were especially hard hit, slumping for a second
day. Vanke, China's leading developer, fell 5.22 percent to 29.40
yuan, Poly Real Estate dropped 8.77 percent to 59.79 yuan, and
Gemdale, another major developer, fell 6.41 percent to 40.75
yuan.
Real estate stocks posted large losses Wednesday after the PBOC
and the China Banking Regulatory Commission (CBRC) announced a new
move to crack down on speculative mortgage activity.
Profit-taking sank steel stocks, with Baoshan Steel down 6.76
percent to 15.86 yuan, Wuhan Steel down 5.85 percent to 16.09 yuan
and Baotou Steel down 4.97 percent to 7.27 yuan
Lin Jian, an analyst with the Shenzhen-based Jiangnan
Securities, said that the market might experience a powerful
rebound, as funds put into PetroChina, which accounts for nearly a
quarter of the total weight of the benchmark index, exceeded the
money taken out. PetroChina, however, slid 1.96 percent to 30.35
yuan on Thursday, which helped pull down the index.
There was almost a tone of panic in the market, and stocks would
likely fluctuate in the near future, according to Beijing Shoufang
Securities.
(Xinhua News Agency December 13, 2007)
