Shanghai Daily news

Shares in Shanghai fell to fresh six-year lows yesterday, led by bus operators amid concern over shrinking profit margins after diesel prices were raised.
The Shanghai Composite Index, which covers yuan-denominated A shares and foreign-currency B shares, shed 0.99 percent to 1,124.27, the lowest close since May 19, 1999, when it dived to 1,109.09. The A-share Index lost 0.99 percent to 1,180.10 and the B-share Index ended 1.38 percent lower to close at 70.58.
The Shenzhen Composite Index, which tracks the smaller one of the mainland's two stock markets, plunged 1.22 percent to 271.23.
"The hike in fuel (prices) will cast a blow to public transport companies and coach firms, as they are the major consumers of diesel," said Zhang Qi, an analyst with Haitong Securities Co Ltd.
"Another reason that these companies will be big victims is that bus fares and coach ticket prices are regulated by the government, so they will find it difficult to pass on the increasing costs" to customers.
Shanghai Bashi Industrial (Group) Co Ltd dropped 1.98 percent to 3.97 yuan (47 US cents) while Shanghai Qiangsheng Holding Co Ltd tumbled 1.14 percent to close at 6.07 yuan.
Shanghai-based Dazhong Transportation (Group) Co Ltd finished at 5.69 yuan, down 0.52 percent.
There are more than 18,000 buses running on city roads, and more than 80 percent of the vehicles are powered by diesel, industry statistics show.
The jump in fuel prices is estimated to raise the running costs of a diesel-powered bus by 12 yuan a day, a local industry authority said.
China raised the wholesale price of diesel nationwide by 150 yuan per metric ton in response to high global crude prices. The rates for No. 0 diesel, which is widely used, jumped more than 5 percent to 3.67 yuan a liter from 3.49 yuan.
Analysts said the rise in diesel prices will also raise the cost for hotels, which use diesel as fuel for air-conditioning and heating equipment.
Guangzhou Dong Fang Hotel Co dived 2.31 percent to 2.54 yuan.
Industry analysts noted the market may sink further as more listed companies are expected to join the share-sales program while some traders are monitoring the possibility the benchmark gauge in Shanghai plunging below 1,000, a level that hasn't been touched since February 1997.
To ease worries over the increased fund-raising activities, the stock market regulator may halt vetting of initial public offerings for "quite a long" period, the Chongqing Morning Post said yesterday, citing an industry insider.
Bucking the downward spiral, shares of Sany Heavy Industry Co surged to the daily cap of 10 percent to 18.65 yuan after the machinery maker tailored a plan to compensate minority share owners in exchange for trimming state holdings.
Holders of the firm's tradable equity are offered three shares plus 8 yuan for every 10 share held, according to a statement.
Sany was among the four pilot companies that China selected on May 9 to start trial disposal of government ownership. All four were set to unveil proposals this week.
Packaging materials maker Shanghai Zi Jiang Enterprise Group Co said yesterday its state shareholders expect to distribute 3 shares for every 10 held by owners of free-floating entities. Computer services provider Tsinghua Tongfang Co plans to offer 10 new shares for every 10 held.
Tsinghua shares fell 41 percent this year while Zi Jiang stock dropped 22 percent. Both will resume trading today.
Elsewhere, Guangdong Kelon Electrical Holdings Co, China's biggest refrigerator maker, dived 5.30 percent to 2.50 yuan.