Shanghai market dips as heavyweights fall

By Lydia Chen  |   2008-6-26  |     ONLINE EDITION

SHANGHAI'S key stock index snapped a two-day winning streak and dipped today amid concern government measures to curb inflation will erode company profits.

The Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B shares, dipped 0.11 percent, or 3.16 points, to 2,901.85 at 3pm.

Gainers in the Shanghai market outnumbered losers 556 to 202 while 22 were unchanged.

The Shenzhen Composite Index, which tracks the smaller domestic stock exchange, was up 0.85 percent, or 7.13 points, to 846.83.

China Petroleum, known as Sinopec, the nation's biggest oil refiner, slumped 2.16 percent to 11.30 yuan (US$1.64) while PetroChina, the country's biggest oil producer and market heavyweight, lost 1.40 percent to 15.54 yuan.

Banks also dropped today.

Industrial and Commercial Bank of China, the country's biggest lender, lost 2.08 percent to 5.17 yuan. Huaxia Bank decreased 2.21 percent to 10.17 yuan.

Steel makers suffered a wide sell-off today.

Baoshan Iron & Steel Co, China's biggest steel maker, was down 1.25 percent to 9.47 yuan. Wuhan Iron & Steel slid 1.74 percent to 10.47 yuan.

Baosteel Group Co, which represents Chinese steel makers in annual iron ore price talks with global mining giants, early this week agreed to pay 144.66 US cents a dry metric ton unit for so-called Pilbara blend fines in the year that began April 1, up 80 percent from a year ago.

Elsewhere, Jinzhou Port Co, a port operator in northeastern China, sank 5.04 percent to 7.72 yuan after yesterday's 9.97 percent dive. The company said on Tuesday that it plans to sell 1.9 billion yuan of shares to PDA Corp, parent of Hong Kong-listed Dalian Port (PDA) Co.

Konka Group Co, the Chinese television and handset maker, dipped 0.50 percent to 4.02 yuan. It will apply for a credit line worth as much as 3.5 billion yuan from Bank of China Ltd, it said in a statement to the Shenzhen Stock Exchange yesterday.

Jiangsu Alcha Aluminum performed strong in the afternoon session and gained the daily cap of 10 percent to 11.77 yuan. Aluminum Corp
of China Ltd，the biggest producer of the metal in China, also enjoyed the 10 percent rise to 14.19 yuan.

The company expects a government decision to raise fuel and electricity prices will increase production costs by about 5 million yuan in the second half of the year, it said in a statement to the Shenzhen Stock Exchange yesterday.

Dongfang Electric Co, China's second-biggest maker of power equipment, said yesterday it will delay some deliveries of coal-fired steam turbines by as much as six months because the May 12 earthquake damaged one of its factories. The shares hiked 1.11 percent to 30.17 yuan today.