Index dips below 2,800 points after wide sell-off

By Lydia Chen  |   2008-6-17  |     ONLINE EDITION

SHANGHAI'S key stock index sank below 2,800 points due to a wide sell-off today.

The Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B shares, lost 2.76 percent, or 79.35 points, to 2,794.75 at 3pm.

Losers in the Shanghai market outnumbered gainers 747 to 53 while four were unchanged.

The Shenzhen Composite Index, which tracks the smaller domestic stock exchange, was down 4.53 percent, or 38.07 points, to 801.97.

Securities shares and property developers led the decline as concerns about economic fundamentals have escalated into a loss of confidence in the stock market.

But aerospace firms enjoyed a good day after a report said the country's main plane makers will merge.

Citic Securities, the nation's largest brokerage, was down 6.99 percent to 24.76 yuan (US$3.59) while Haitong Securities plunged the daily cap of 10 percent to 20.33 yuan. Hongyuan Securities also slid 10 percent to 17.19 yuan.

Yunnan Copper Industry Co, China's third-biggest producer of the metal, was among losing commodity shares today. Yunnan Copper sank 6.80 percent to 16.85 yuan. The company said it will sell 2.8 billion yuan of one-year notes on June 20 to fund the purchase of raw materials and repay bank loans.

Aluminum Corp of China Ltd, the nation's biggest maker of the lightweight metal and known as Chalco, declined 7.99 percent to 13.02 yuan.

Its parent Aluminum China may increase its stake in Rio Tinto Group should favorable market conditions exist, President Xiao Yaqing said.

Elsewhere, Daqin Railway Co, the operator of China's biggest coal transport network, also buckled 2.83 percent to 12.69 yuan. The company said yesterday that shareholders approved its plan to sell as much as 15 billion yuan of bonds to buy wagons and locomotives.

Jiangxi Hongdu Aviation Industry Co erased morning session's 3.32 percent gain and lost 1.48 percent to close at 16.01 yuan today.