Chinese shares fall following declines by steel, electronics and computer counters

Chinese shares fell today following declines by steel, electronics and computer counters.

The Shanghai Composite Index dipped 0.18 percent to close at 2,780.96 points, and the Shenzhen Composite Index ended 0.68 percent lower at 8,784.90 points.

Both markets suffered as shares of steel, electronics and computer companies lost heavily.

“The downward trend of Chinese stocks will continue in the next two or three weeks,” Sealand Securities said.

However, a recent development might provide some relief for Chinese equities. Index provider MSCI said in its most recent quarterly index review that it will be proceeding with the second phase of a partial inclusion of China A shares in the MSCI Emerging Markets Index and other indexes.

Because the move was mostly expected, the positive impact on the Chinese market would be marginal, Hao Hong, head of research at the Bank of Communications International said, adding that "because the market has fallen substantially, any foreign money coming in would be a help to stabilize the Chinese stock market. In the near future, I wouldn’t be surprised to see some consolidation or a technical rebound.”