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China's A and B shares ended lower for the second straight session yesterday as weak sentiment prompted investors to dump companies with share-issue plans, brokers said.
The benchmark Shanghai composite index, grouping hard-currency B shares for foreigners and yuan-denominated A shares, finished 0.82 percent lower at 1,388.17 points.
The Shenzhen equivalent fell 18.06 points or 0.56 percent to 3,181.50 points.
The Nanjing Steel Co Ltd, which plans to issue 120 million additional A shares, was one of yesterday's worst performers, sliding 3.44 percent to 7.30 yuan (88.3 US cents).
The Hongyuan Securities Co, which recently offered nearly 100 million new A shares, fell 2.1 percent to 6.99 yuan (84.5 US cents).
The Shanghai index has shed 15 percent since mid-April versus a 38 percent rally in neighbouring Hong Kong over the same period, hit by negative factors from a rash of stock offers to a government-ordered tightening of bank loans.
"Investors couldn't see any reason to go on with their buying, which led to a pull-back in leaders such as the H-shares, as well some in the broader market," said Zhang Qi, a Haitong Securities analyst.
Last Friday, the mainland bourses saw a rare burst of activity as shares with listings in Hong Kong surged higher, leading to the benchmark's biggest one-day percentage gain in five months.
But a lack of fresh stimuli has seen market activity slow down this week. Further dampening investor sentiment was the latest batch of profit warnings and fund-raising calls from listed firms, dealers said.
The mainland's listed companies are required to post January-September results in October, though most would do so only in the latter part of the month.
"Investor confidence is damaged and the market is now nearing the peak of the third-quarter corporate reporting season, so many investors are careful not to trade too heavily," said analyst Zhang Yong at Great Wall Securities.
Analysts said they expected the market to remain dismal over the near term, with some saying the index could head for a year low of below the 1,311.684 points set on January 6.
Some copper plays bucked overall weakness to rise yesterday, cheered by a rally in prices of the metal on both domestic and global markets, brokers said.
Three-month copper on the London Metal Exchange surged to three-year highs in yesterday's Asian trade, while most Shanghai copper futures notched record highs.
Jiangxi Copper, China's second-largest copper maker, ended up 1.31 percent at 5.40 yuan (65.3 US cents).
Tongdu Copper - a unit of the country's largest producer, the Tongling Non-Ferrous Metals Co Ltd - climbed 0.84 percent to 7.20 yuan (87.1 US cents).
(China Daily October 15, 2003)
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