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China shares sharply lower after reserve requirement hike, weak Wall St |
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Monday, 12 November 2007 02:56 |
SHANGHAI (XFN-ASIA) - China shares were sharply lower in early trade after the central bank announced another hike in the bank reserve requirement by half a percentage point to 13.5 pct, dealers said.
The hike follows a half percentage point increase in the reserve ratio on Oct 25. Saturday's move will be the ninth hike in the reserve ratio this year.
A big sell-off in the US markets Friday also discouraged investors, who have already suffered an 8 pct market loss last week.
At 9:36 am, the Shanghai Composite Index fell 101.22 points or 1.90 pct to 5,214.32, after opening down 134.37.
Shares fell across the board with metals companies leading the declines.
Baoshan Iron & Steel Co Ltd (SHA 600019) lost 0.41 yuan to 14.40, and Jiangxi Copper Co Ltd (SHA 600362; HK 0358) shed 1.95 yuan to 51.80.
Banks also weakened as investors worried that their loan growth will be constrained because of the need to set aside more funds for deposit with the central bank.
Bank of China (SHA 601988; HK 3988) fell 0.06 yuan to 7.13, and Industrial and Commercial Bank of China (OOTC:IDCBF) (SHA 601398; HK 1398) lost 0.09 yuan to 8.26.
China Petroleum & Chemical Corp (NYSE:SNP) (Sinopec)(SHA 600028; HK 0386; NYSE SNP) slid 0.86 yuan to 22.50, and Petrochina Co Ltd (SHA 601857) fell 1.02 yuan to 37.16.
(1 usd = 7.41 yuan)
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Copyright Thomson Financial News Limited 2007. All rights reserved.
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