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Shanghai shares drop as loan growth eases in October

SHANGHAI'S stock market closed lower in the morning session with weak performance of banks as new loans dropped in October.

The benchmark Shanghai Composite Index was down 0.64 percent, or 20.42 points, to close at 3,158.19 points. Turnover was 74.9 billion yuan(US$11 billion). Losers outnumbered gainers 564 to 283, and 65 remained unchanged.

The Shenzhen Composite Index, which tracks the smaller domestic market, dipped 0.53 percent to close at 1,128.69 points.

China's consumer price index, the main gauge for inflation, was down 0.5 percent year on year in October, the National Bureau of Statistics said this morning. The Producer Price Index, the factory gate inflation measurement, dropped 5.8 percent from a year ago.

Banking shares were among the losers after new loans in October was down 51 percent from September to 253 billion yuan. China Merchants Bank Co, the nation's fifth-largest bank by market value, dropped 2.14 percent to 18.28 yuan. Industrial & Commercial Bank of China, the nation's biggest lender, lost 0.75 percent to 5.30 yuan. Shanghai Pudong Development Bank eased 1.23 percent to 23.20 yuan. China Construction Bank dipped 0.83 percent to close at 5.97 yuan.

Property developers showed mixed results after the National Development and Reform Commission said housing prices in 70 major cities jumped the most in more than a year in October. Property prices gained for a fifth month since June.

However, investors were afraid that exemption of deed tax and other stimulus measures might be pulled back at the end of the year.

Shanghai Lujiazui Finance & Trade Zone Development Co was down 1.80 percent to 28.33 yuan. Shanghai Shimao Co Ltd jumped 3.49 percent to 18.08 yuan. China Vanke Co, the biggest listed domestic real estate developer, was down 1.57 percent to 11.95 yuan. Gemdale Corporation dropped 2.02 percent to 16 yuan.

Beiqi Foton Motor said it will extend cooperation with Daimler AG by building plants outside China to make heavy-duty trucks. Its shares was down 0.74 percent to 20.11 yuan.

Dongfeng Automobile Co said vehicle sales in the first 10 months of this year rose 14.3 percent to 167,962 units. The stock was down 1.24 percent to 6.38 yuan.

Metal producers were also weak. Yunnan Copper Co was down 2.02 percent to 31.11 yuan. Zijin Mining Co dipped 0.41 percent to 9.71 yuan. Jiangxi Copper decreased 1.20 percent to 40.30 yuan.


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