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Real estate gloom drags market down

SHANGHAI'S key stock index ended over 1 percent lower at morning break, led by property developers amid profit taking.

The benchmark Shanghai Composite Index dropped 1.13 percent, or 29.98 points, to close at 2,621.44 points. Losers outnumbered gainers 725 to 119 while 7 remained unchanged. Half-day turnover stood at 75.47 billion yuan (US$11.1 billion).

The Shenzhen Composite Index, which tracks the smaller domestic market, was down 1.77 percent to close at 881.5 points.

Property developers tumbled with analysts saying the sector is overvalued with excessive optimism for a recovery in the real estate market. Gemdale Corp, a Chinese partner of ING Group NV, dived 5.1 percent to 16 yuan. Poly Real Estate Group co, China's second-largest developer by market value slid 3.69 percent to 21.92 yuan. Shanghai-based Shimao Property Co eased 1.32 percent to 14.17 yuan.

Coal producers were also among the losers. China Shenhua Energy Co, Asia's largest coal producer lowered 3.21 percent to 27.14 yuan. Datong Coal industry Co, China's second-largest coal company by capacity, withdrew 2.11 percent to 38.10 yuan. Pindingshan Tian'an Coal Mining Co was off 1.46 percent to 35.76 yuan.

Bucking the downward trend, China Yangtze Power Co advanced 2.06 percent to 13.9 yuan. PetroChina, the country's largest oil producer and the market's biggest component, added 0.99 percent to 13.2 yuan.


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