China shares down 3.2 pct after Wall Street decline

(Xinhua)
Updated: 2008-10-22 20:25

BEIJING -- Chinese stocks fell for a second day on Wednesday following overnight Wall Street sell-offs and on worries a slowing economy could dent corporate profits.

Investors look at an electronic board showing stocks information at a brokerage house in southwest China's Chongqing Municipality on October 22, 2008. [Xinhua]

The benchmark Shanghai Composite Index dropped 62.71 points, or 3.20 percent, to close at 1,895.82. The Shenzhen Component Index retreated 111.14 points, or 1.74 percent, to 6,278.04.

The decline echoed weakness in other regional markets. Japan's Nikkei 225 Stock Average shed 6.79 percent and Hong Kong's Hang Seng Index lost 5.15 percent. Overnight, the Dow Jones Industrial Average slid 2.50 percent to 9,033.66.

Losers outnumbered gainers by 720 to 144 in Shanghai and 533 to 178 in Shenzhen. Aggregate turnover shrank to 46.05 billion yuan (US$6.7 billion) from Tuesday's 56.91 billion yuan.

Most investors were pessimistic about third quarter corporate earnings, and the global financial turmoil made them more cautious, said Li Jun, a Nanjing Securities analyst.

Huaneng Power International, a unit of the country's biggest electricity producer, tumbled 9.93 percent to 6.08 yuan. It recorded a loss of 2.63 billion yuan in the first nine months due to high coal prices and electricity price caps.

SDIC Huajing Power Holdings Co. fell by the 10 percent daily limit to 7.44 yuan. GD Power Development Co. slumped 7.50 percent to 5.18 yuan.

Jiangxi Copper Co. dropped 2.03 percent to 10.64 yuan after posting a 26.9 percent decline in net earnings in the third quarter from a year earlier. Western Mining Co. retreated 3.81 percent to 6.32 yuan after saying its net profit fell 32.4 percent year-on-year in the third quarter.

Property shares fell heavily after the average property prices in 70 major cities edged up only 3.5 percent year-on-year but was down 0.1 percent month-on-month in September.

China Vanke, the country's largest property developer by market value, slid 5.31 percent to 6.60 yuan. Poly Real Estate Group Co. fell 5.39 percent to 14.22 yuan and Gemdale Corp. dropped 7.08 percent to 5.91 yuan.

Construction materials companies also slid, with Anhui Conch Cement Co., the country's biggest cement producer, dropping 5.93 percent to 17.30 yuan. Its net profit growth slowed to 13.3 percent year-on-year in the third quarter, down from 46.9 percent in the first half.

PetroChina, the biggest component in the Shanghai Composite Index, slumped 5.71 percent to 11.22 yuan. Sinopec, Asia's largest oil refiner, lost 3.59 percent to 8.33 yuan.

Most financial stocks also fell. Industrial and Commercial Bank of China dropped 1.76 percent to 3.91 yuan. China Life slipped 3.75 percent to 19.48 yuan and Ping An Insurance slid 3.81 percent to 25.02 yuan.

Most textile stocks gained following the increases in export tax rebates. Shandong Ruyi surged by daily 10 percent limit to 4.09 yuan. Nanjing Textiles Import and Export Corp. also jumped by the limit to 2.99 yuan.

The weak market sentiment, however, left in doubt whether textile stocks could extend gains in the following days, said Ye Yihua, a South China Securities analyst.