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Shanghai index falls 0.89% to 46-month low
By Ye Zhen |
November 28, 2012, Wednesday
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Online Edition
Online Edition
SHANGHAI stocks fell for a third day, sending the key index to its lowest in 46 months, as non-tradable shares will flood the stock market next month and the US market tumbled on "fiscal cliff" anxiety.
The benchmark Shanghai Composite Index lost 0.89 percent, or 17.64 points, to 1,973.52 points, the lowest close since January 16, 2009. Daily turnover was 34.5 billion yuan (US$5.6 billion).
Data from Southwest Securities showed that 180.9 billion yuan worth of non-tradable shares of 96 companies will be allowed to circulate in the Shanghai and Shenzhen markets in December, the most since September 2011.
"The unlocked shares will lead to an oversupply of shares when market liquidity is tight toward the year-end. This imbalance is a major threat for the market now," China Securities Journal cited market analyst Zhang Yidong as saying.
The US market slump also weighed on Shanghai shares. "Investors are worried that the US may fail to avoid the "fiscal cliff" as the Congress and the White House have not reached an agreement," said Zhang Gang, analyst at the Southwest Securities.
Non-ferrous metals producers were the big losers today. Inner Mongolia Baotou Steel Rare-earth (Group) Hi-tech Co, China's biggest producer of rare earth materials, dropped 5.4 percent to 30.27 yuan. Rising Nonferrous Metals Share Co slipped 4 percent to 37.47 yuan.
Gold stocks declined after gold futures for December delivery fell US$7.3 to US$1,742.30 per ounce yesterday in New York. Zijin Mining Group Co, the nation's largest gold producer, dropped 2.2 percent to 3.62 yuan. Shandong Gold Mining Co shed 1.7 percent to 36.79 yuan. Zhongjin Gold Corp decreased 3.3 percent to 15.08 yuan.
The benchmark Shanghai Composite Index lost 0.89 percent, or 17.64 points, to 1,973.52 points, the lowest close since January 16, 2009. Daily turnover was 34.5 billion yuan (US$5.6 billion).
Data from Southwest Securities showed that 180.9 billion yuan worth of non-tradable shares of 96 companies will be allowed to circulate in the Shanghai and Shenzhen markets in December, the most since September 2011.
"The unlocked shares will lead to an oversupply of shares when market liquidity is tight toward the year-end. This imbalance is a major threat for the market now," China Securities Journal cited market analyst Zhang Yidong as saying.
The US market slump also weighed on Shanghai shares. "Investors are worried that the US may fail to avoid the "fiscal cliff" as the Congress and the White House have not reached an agreement," said Zhang Gang, analyst at the Southwest Securities.
Non-ferrous metals producers were the big losers today. Inner Mongolia Baotou Steel Rare-earth (Group) Hi-tech Co, China's biggest producer of rare earth materials, dropped 5.4 percent to 30.27 yuan. Rising Nonferrous Metals Share Co slipped 4 percent to 37.47 yuan.
Gold stocks declined after gold futures for December delivery fell US$7.3 to US$1,742.30 per ounce yesterday in New York. Zijin Mining Group Co, the nation's largest gold producer, dropped 2.2 percent to 3.62 yuan. Shandong Gold Mining Co shed 1.7 percent to 36.79 yuan. Zhongjin Gold Corp decreased 3.3 percent to 15.08 yuan.
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