stock index dropped for a second day as investors feared that rising inflation
may force the government to further raise interest rates.
The Shanghai Composite Index, which tracks the larger of China’s
stock exchanges, shed 8.49, or 0.3 percent, to close at 2,975.04. The index
added 0.1 percent this week, which is its fourth-straight gain with the CSI 300
Index rising 0.1 percent to close at 3,378.66.
Industrial & Commercial Bank of China Ltd, which is
often considered the barometer of Chinese banking industry and is the largest
listed lender, slumped for second day in a row as the inflation rate grew at
the fastest rate in 23 months.
It dropped 0.7 percent to close at 4.48 yuan with Agricultural
Bank of China Ltd., the third largest, shedding 1.1 percent to close at 2.81
yuan. Bank of China Ltd., the fourth largest, lost 1.4 percent to close at 3.50
Citic Securities dropped 2.8 percent to close at 15.04 yuan,
showing an improvement from the 3.2 percent dip of yesterday. The fall is
shocking for some investors as the company added as much as 34 percent this
month amid speculations of increased earning given rising stock-market
consumer prices saw an up tick of 3.6 percent last month, according to statistics
bureau of the Chinese government. China
has set a full-year inflation target of 3 percent but analysts believe that an
update might be required after the government raised interest rates on Oct. 19
for the first time since 2007.