Shares extend losses to hit 31-month low

Shanghai stocks continued to fall yesterday to a 31-month low, led by losses in iron and steel companies and the building material sector.

The Shanghai Composite index shed 0.18 percent to close at 2,664.8 points. Turnover shrank to 96.88 billion yuan (US$14.11 billion) from 102.8 billion yuan on Monday, hitting its lowest in more than 32 months.

Investors were spooked after the National Development and Reform Commission was quoted in local media as saying it would investigate the prices of building materials, leading to them disposing shares of building material firms.

China Kings Resources Group Co fell 6.76 percent, Anhui Conch Cement Company shed 4.81 percent, and both Fujian Cement Inc and Huaxin Cement Co lost over 3.5 percent.

Iron and steel shares also declined sharply, with Maanshan Iron & Steel Company dropping by the 10 percent daily limit and Xinyu Iron & Steel Co down 9.39 percent.

Other decliners included coal companies such as Jinneng Science & Technology Co and Shanxi Coking Co which both shed over 5.5 percent, and Kailuan Energy Chemical Corporation sinking 9.92 percent.