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December 4, 2009

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Home » Business » Finance

Finance shares sink key index

WEAK banking and other financial shares dragged Shanghai's benchmark index to close slightly lower yesterday.

The Shanghai Composite Index dipped 0.16 percent, or 5.12 points, to close at 3,264.63. Turnover totaled 189 billion yuan (US$27.7 billion).

Banks retreated after the China Securities Journal reported yesterday that only 5 trillion yuan to 7 trillion yuan of new loans may be extended in China in 2010, citing central bank researcher Bu Yongxiang. By comparison, domestic banks granted 8.92 trillion yuan in new loans in the first 10 months this year, way above its target of 5 trillion yuan set at the beginning of this year. The M2 money supply may jump 16 to 17 percent next year, the report said.

The Industrial and Commercial Bank of China, the nation's biggest lender, lost 1.31 percent to 5.26 yuan, Shanghai Pudong Development Bank shed 0.72 percent to 22.11 yuan and China Construction Bank dipped 0.67 percent to 5.97 yuan.

"The fluctuations may continue until early next week as trading is flat and investors remain cautious after the index has risen for three days," Kang Hongtao, an analyst at Guoyuan Securities, wrote.

China Pacific Insurance (Group) Co Ltd fell 2.10 percent to 24.65 yuan and Ping An Insurance (Group) Co lost 1.51 percent to 56.86 yuan as investors cashed in gains.

Shanghai Lujiazui Finance & Trade Zone Development Co rose 6.57 percent to 29.37 yuan after 21st Century Business Herald cited an unidentified government official as saying parent Shanghai Lujiazui Group Co will partner Disney to build the theme park in Shanghai.

Brokerages gained after Shenzhen Stock Exchange President Song Liping's remarks on Wednesday about stock index futures and margin trading, sparking talks margin trading will start soon. Haitong Securities rose 3.11 percent to 16.90 yuan and Sinolink Securities added 2.20 percent to 24.11 yuan.


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