Chinese shares down 2.2 pct in morning trade on slower growth concern
8/9/2008 17:42
Chinese stocks extended declines this morning on lingering worries over
slower economic and corporate profit growth.
The benchmark Shanghai Composite
Index finished the morning trade 48.09 points or 2.18 percent lower at 2,154.36.
The Shenzhen Component Index dropped 221.96 points or 3.06 percent to
7,042.24.
The index opened slightly higher at 2,210.34 and rose as much as
0.82 percent to 2,220.55 at one time. This came amid broad gains on regional
markets boosted by yesterday's news the US government will take over two
mortgage giants Fannie Mae and Freddie Mac to stabilize the financial
market.
Tokyo's Nikkei 225 index was more than 3 percent higher at about 1
p.m. local time. Hong Kong's Hang Seng index gained 3.8 percent at about 12
a.m.local time.
But the stocks reversed to losses later on low investor
sentiment after the key Shanghai index plunged 8.1 percent last week. The index
has fallen 64.8 percent from its all time high in mid October.
Market
declines would continue in the short time against the backdrop of slower
economic growth in China, according to Shenyin Wanguo Securities.
China is
slated to release major economic data including consumer price index, industrial
output and fixed asset investment starting from Wednesday.
The market slump
also came despite China's securities regulator said Friday it will allow
shareholders of listed companies to issue exchangeable bonds to ease oversupply
of the shares after the lock-up periods.
Such bonds could provide
shareholders with a new funding channel other than simply dumping their
holdings. This would ease the impact of heavy selling, said an unidentified CSRC
official in a statement.
Investors worried the shareholders would continue
selling their stocks as the regulation was not mandatory, said
analysts.
Xinhua
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