Stocks drop the most in a week
SHANGHAI - Mainland stocks dropped the most in a week, capping a second weekly retreat, on concern the government will intensify measures to slow economic growth and avert asset bubbles.
Poly Real Estate Group Co and Gemdale Corp paced declines by developers after the Shanghai Securities News said the government may require larger deposits for land auctions.
The Shanghai Composite fell 37.87, or 1.2 percent, to close at 3013.41, the most since March 4 and capping a weekly loss of 0.6 percent. The CSI 300 Index declined 1.3 percent to 3233.13.
"Further tightening such as an increase in interest rates is only a matter of time," said Zhao Zifeng, who helps oversee about $10.2 billion at China International Fund Management Co.
"But meanwhile corporate earnings are still growing amid the economic recovery. These two factors will basically limit the market to fluctuating in a range until there's change to either of them."
Xinjiang-based shares rallied after the China Securities Journal reported the central government will introduce an economic stimulus plan for the northwest region in May.
Xinjiang Urban Construction (Group) Co climbed 4 percent to 14.47 yuan. Xinjiang Joinworld Co, a metals producer, rose 2 percent to 18.53 yuan.
Bloomberg News
(China Daily 03/13/2010 page9)
