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Chinese shares tumble amid intensified regulation

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Beijing, Aug. 31 : China’s stock market saw a weak performance on Monday, ending last week’s winning streak, as the government intensifies efforts to crack down on market manipulation.

According to Xinhua news agency, the benchmark Shanghai Composite Index dipped 0.82 percent to finish at 3,205.99 points, and the Shenzhen Component Index lost 2.32 percent to close at 10,549.16 points.

The ChiNext Index, China’s NASDAQ-style board of growth enterprises, fell 4.09 percent to end at 1,996.87 points.

All key indices declined more than 3 percent in early trading, before losses narrowed in the afternoon session. Nearly 300 shares plunged by the daily limit of 10 percent.

Turnover on the two bourses remained anemic, indicating the market sentiment has yet to recover.

Although banks, weapons manufacturers and infrastructure construction companies saw their stocks rise, more than 1,800 companies suffered losses, weighed down by battered brokerages, after four senior executives of CITIC Securities were held for suspected insider trading on Sunday.

Apart from the executives, an official with the China Securities Regulatory Commission (CSRC) and a journalist, were also put under “criminal compulsory measures” for alleged market manipulation and trading violations.

Compulsory measures include arrest, detention, summons, bail pending trial, or residential surveillance.

The government appears to be paying greater attention to the stock market rout, with Premier Li Keqiang telling the State Council on Friday that financial stability was significant to the broader economy.

He said, “It is important to foster an open, transparent capital market for long-term stability and to ensure its sound development,” said Li.

He also added that risk management must be improved to prevent regional or systemic risks. (ANI)