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Market slides at midday as banks tighten loans

SHANGHAI'S market lost more than 2 percent to below 3,000 points in the morning session with weak performance of banks after regulator tightened the oversight of personal loans.

The benchmark Shanghai Composite Index decreased 2.10 percent, or 63,81 points, to close at 2,967.52 points. Turnover was 62.2 billion yuan(US$9.12 billion). Losers outnumbered gainers 737 to 130, and 45 remained unchanged.

The Shenzhen Composite Index, which tracks the smaller domestic market, was down 1.73 percent to close at 1,048.69 points.

China Banking Regulatory Commission said on its Website yesterday that it will tighten the oversight of personal loans to step up its efforts to prevent capital flowing into stock market and property sector. The draft rule stipulated that loans exceeding 300,000 yuan will be given directly to the counterparty of the borrower rather than the borrower.

Industrial & Commercial Bank of China, the nation's biggest lender, decreased 2.17 percent to 4.95 yuan. Shanghai Pudong Development Bank lost 1.69 percent to 21.46 yuan. China Construction Bank buckled 2.37 percent to close at 5.76 yuan. Bank of Communications lost 3.42 percent to 8.46 yuan.

Metal producers were also weak. Yunnan Copper Co slid 4.48 percent to 29.88 yuan. Shandong Gold Mining Co retreated 2.46 percent to 65.10 yuan. Aluminum Corporation of China Ltd slumped 4.57 percent to 13.78 yuan. Zijin Mining Co decreased 2.80 percent to 9.01 yuan.

China Vanke Co, the biggest listed domestic real estate developer, lost 3.44 percent to 11.25 yuan. Gemdale Corporation buckled 4.57 percent to 15.04 yuan. Poly Real Estate Group lost 3.26 percent to 25.55 yuan.

China Coal Energy Co, the nation's second biggest fuel producer, said third quarter profit fell 36 percent to 1.41 billion yuan. Its shares buckled 4.05 percent to 13.04 yuan.

Drug makers were among the gainers as government purchasing of swine flue vaccines is expected to boost their revenue. Hualan Biological Engineering Inc jumped 5.83 percent to 59.95 yuan. Jiangsu Lianhuan Pharmaceutical Co surged the daily limit of 10 percent to 12.38 yuan.


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