China Stocks dive to fresh low as confidence waning

China Stocks dive to fresh low as confidence waning

Domestic stock markets suffered another setback on Tuesday as the major index dove to its lowest since March 2007 with no stimulating news from the regulator.

Although ups and downs are commonplace in the capital market, the recent share slide has caused unusual market loss in a short time and should receive substantial regulatory attention to avoid further potential risks, market watchers said.

The benchmark Shanghai Composite Index opened at 2,873.13 and dropped to 2,769.12 in the afternoon session, the lowest point since March 6, 2007. It wound up the day's trading at 2794.75, 2.76 percent lower than Monday's close.

The smaller Shenzhen market lost even more as the Shenzhen Component Index tumbled 4.03 percent to 9,429.50 by close.

Turnover of the two markets totaled 66.8 billion yuan ($9.54 billion), with more than 1,286 stocks closing lower. Only 159 stocks gained and 127 ended flat.

Most blue chips performed poorly. Air China plunged 9.85 percent despite an overnight decline in crude oil prices. PetroChina recovered some losses in the last quarter but still ended some one percent lower at 15.24 yuan.

The financial sector was also weak. The Bank of China declined 0.48 percent to 4.17 yuan. China Construction Bank and CITIC Bank closed down 2.09 percent and 2.22 percent respectively, both below their initial public offering prices.

The aircraft-making sector flew a little higher among the depressed market today on reports that the nation will restructure its aviation industry by consolidating the two leading state-owned aircraft makers. Hafei Aviation Industry, a Harbin-based aircraft producer, jumped to the daily limit of ten percent.

In an online interview yesterday, Huang Hongyuan, director of the institution department of China Securities Regulatory Commission, vowed that no matter what policies it enacts, it will aim to play a positive role in the sustainable development of the stock market, rather than impeding it. However, the official didn't reveal any substantial measures to stimulate the market.

In the recent report on financial stability, the central bank also said the regulator should closely follow the development of the stock market and should adopt comprehensive measures to prevent excessive fluctuations in the market.

However, many investors argued that it is the one-percentage point reserve requirement ratio hike announced on June 7 that had triggered a new round of panic selling even after a 50-percent stock correction since last November. Although the move mainly targeted excessive liquidity and credit growth, the market is still wary of negative effects on the fund-thirst capital market.

In sharp contrast, other Asian markets reaped their largest gains in two months on Monday due to falling oil prices and a Wall Street rally last Friday. The Hong Kong Hang Seng Index and the Japanese Nikkei both rose some two percent yesterday and saw minor changes in the morning session today.

Date	Index	Open	High	Low	Close	Change	Change(%)	Volume(Shares)
2008-06-17	CSI 300	2950.4	2977.89	2820.64	2842.68	-109.57	-3.71	2646377800
2008-06-16	CSI 300	2981.09	3012.99	2900.08	2952.24	-26.88	-0.90	2681379400
2008-06-13	CSI 300	3087.34	3108.99	2975.66	2979.12	-105.52	-3.42	2531983700
2008-06-12	CSI 300	3123.64	3148.74	3022.88	3084.63	-55.67	-1.77	3145410900
2008-06-11	CSI 300	3155.94	3181.82	3097.4	3140.3	-66.26	-2.07	2940973500
2008-06-10	CSI 300	3344.45	3352.32	3188.8	3206.56	-282.94	-8.11	3294996100
2008-06-06	CSI 300	3519.12	3532.3	3470.56	3489.5	-22.64	-0.64	2094422900
2008-06-05	CSI 300	3529.98	3542.24	3487.79	3512.14	-34.78	-0.98	2398927900
2008-06-04	CSI 300	3601.06	3605.06	3513.64	3546.92	-67.20	-1.86	2941765300
2008-06-03	CSI 300	3624.57	3641.43	3585.12	3614.11	-11.72	-0.32	3473514100
2008-06-02	CSI 300	3600.23	3650.48	3580.58	3625.83	14.50	0.40	2825335800
2008-05-30	CSI 300	3585.61	3620.23	3552.66	3611.33	30.46	0.85	2859084700
2008-05-29	CSI 300	3666.2	3677.02	3578.73	3580.87	-95.36	-2.59	2942274000
2008-05-28	CSI 300	3583.28	3698	3561.73	3676.23	100.03	2.80	3103491400
2008-05-27	CSI 300	3549.99	3594.66	3533.47	3576.2	16.98	0.48	2476269300
2008-05-26	CSI 300	3643.01	3643.01	3555.76	3559.22	-115.93	-3.15	2818019000
2008-05-23	CSI 300	3697.89	3741.06	3629.01	3675.15	-36.30	-0.98	3344043100
2008-05-22	CSI 300	3732.64	3783.85	3704.16	3711.44	-71.61	-1.89	4074271700
2008-05-21	CSI 300	3668.18	3801.07	3591.57	3783.05	72.23	1.95	4359616200
2008-05-20	CSI 300	3911.1	3946.44	3698.55	3710.82	-203.25	-5.19	3970262900
2008-05-19	CSI 300	3926.31	3936.28	3865.5	3914.07	-22.05	-0.56	2970958100
2008-05-16	CSI 300	3948.03	3982.22	3882.9	3936.12	-11.97	-0.30	3972175200
2008-05-15	CSI 300	4006.66	4038.85	3948.06	3948.09	-27.69	-0.70	5077297500
2008-05-14	CSI 300	3843.47	3975.8	3843.47	3975.78	124.10	3.22	5060690100
2008-05-13	CSI 300	3786.53	3923.17	3778.72	3851.69	-53.23	-1.36	5033801200
2008-05-12	CSI 300	3804.99	3952.79	3766.58	3904.92	26.00	0.67	4538266000
2008-05-09	CSI 300	3960.89	3973.06	3806.52	3878.92	-46.12	-1.17	5365592900