Shanghai: Chinese share prices closed down 5.21% Monday, extending Friday’s steep decline as investors rushed to dump stocks after losing hope that government support was imminent, dealers said.
The benchmark Shanghai Composite Index, which covers both A and B shares, shed 135.65 points to 2,470.07 on turnover of 41.5 billion yuan ($6.1 billion).
“The broad sell-off reflected lack of confidence that there will be a solid rebound in the near term, with the key index lingering around a fresh 19-month low,” traders said.
“Olympics-related stocks’ sharp falls today and Friday triggered some panic selling,” Qiu Yanying from TX Investment told Dow Jones Newswires.
Qiu added that investors were also disappointed by the lack of concrete market-boosting measures by the government that they had hoped for earlier.
“High producer price inflation and a narrowing of the trade surplus would also pressure corporate profits,” they said.
Official figures showed China’s producer or wholesale prices rose 10% in July, their steepest rate in 12 years, while the trade surplus fell 9.6% in the first seven months of 2008 compared with a year ago.
The Shanghai A-share index lost 141.87 points, or 5.19%, to 2,592.49 on turnover of 41.3 billion yuan, while the Shenzhen A-share index was down 51.59 points or 6.58% to 732.42 on turnover of 20.1 billion yuan.