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China's shares ended lower yesterday as fresh slides in Asian regional stock markets deepened investor worries over the weak global economy.
Shanghai's composite index shed 4.276 points to 1,818.419 on turnover of 6.3 billion yuan (US$756 million), as compared to Wednesday's 5.2 billion yuan (US$629 million).
Shenzhen's sub-index tumbled 38.24 points to 3,628.28 on volume of 3.6 billion yuan (US$433 million), slightly up from 3.5 billion yuan (US$425 million) one day earlier.
B-share indices ventured into positive territory several times on rumours of possible bank interest rate cuts, but selling prevailed amid weak investor confidence and fears of military retaliation by the United States after last week's attacks.
Shanghai's B-share index closed down 1.52 per cent at 150.651 points. Turnover was tiny at US$54.65 million, down from an already thin US$58.71 million on Wednesday, due to slow trading interest after last week's attacks.
Shenzhen B shares fell 2.57 per cent to 240.77 on thin turnover of HK$223.82 million (US$29.7 million), down from HK$245.45 million (US$32.5 million). B shares are available to foreign investors.
"B shares have been strongly affected by global factors since the attacks in the United States," said Shanghai Finance analyst Zheng Weigang. "The overnight fall in Wall Street hurt investor confidence and Asian regional losses today added to the woe."
The US Dow Jones industrial average slipped 1.62 per cent on Wednesday while the technology-laced NASDAQ composite index slid 1.75 per cent.
Before yesterday's fall, B shares had climbed for two days after a four-day slide that knocked more than 15 per cent off values of the hard currency shares in the wake of the attacks on New York and Washington.
The rebound was fuelled partly by rumours of cuts in rates on foreign currency and yuan bank deposits. Officials at the central People's Bank of China declined to comment.
But analysts predicted further downslides in the near term because of a lack of confidence that made most investors unwilling to hang onto shares.
"Investors are not willing to hold shares and tend to rush to take profits, due to worries over military retaliation by the United States," said analyst Wu Jiang of Zhejiang Securities.
Simon Lai, an analyst at Shenyin and Wanguo Securities, said worries about possible future terrorist attacks and reports of US preparations for retaliation led to fears of war.
"Such reports have huge psychological impact, with investors reluctant to build positions," he said.
Poultry firm Dajiang (Group) Co was the biggest decliner yesterday, ending down 3.87 per cent at US$0.721 on volume of 2.22 million shares.
The counter has fallen since Tuesday when it announced a unit of Thailand's C P Group would list 286.67 million on Friday, formerly non-tradable institutional shares it owned in the Chinese company.
Shanghai No 1 Department Store (Group) Co was the top A share performer, surging the 10 per cent daily limit to 8.76 yuan (US$1.06) on volume of 3.66 million shares.
The stock was buoyed by news reports yesterday that it had set up China's first Sino-foreign wholesale joint venture with Japan's Marubeni Corp.
(China Daily 09/21/2001)
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