Shanghai stocks post the biggest daily loss this year

By Hu Yumo | 16:10 UTC+8 April 24, 2017 |

Online Edition

SHANGHAI stocks fell today by the sharpest rate so far this year, as market sentiment were dampened after regulator tightened control on aggressive investment and capital management.

The Shanghai Composite Index lost 1.37 percent to close at 3,129.53 points.

China Insurance Regulatory Commission said it would further strengthen supervision of insurance companies to make sure they comply with tighter risk controls, according to an announcement published by the commission on Sunday.

Insurance companies should “avoid aggressive investment strategies”, and take measures to avoid risks stemming from 10 specific areas including liquidity and capital management, according to the announcement.

Companies should set up a mechanism stressing prudential and steady investment, strengthen management over assets and liabilities, and take reasonable risk preference, while avoiding an aggressive investment style, the commission said.

“Market sentiment has been damped by recent tightening supervision on all fronts such as the banking commission, insurance commission, securities regulator,” said Ben Kwong, executive director of KGI Asia Ltd.

"Investors had expected officials to give some kind of signal to comfort the market after the big falls earlier last week, but their hope came to naught, with regulators saying over the weekend that they want to continue tightening,” said Chen Yalong, an analyst in Shanghai at Northeast Securities Co.

Shares in infrastructure, material companies and those related to the Belt and Road initiative were among the biggest decliners today.

Ningxia Building Materials Group Co fell 9.59 percent to 10.65 yuan (US$1.55), China Communications Construction Co lost 8.22 percent to 17.41 yuan and China Railway Construction Co shed 5.64 percent to 13.39 yuan.

Finance

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Shanghai stocks post the biggest daily loss this year

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