SHANGHAI stocks fell for the third day in a row yesterday despite pledges by China’s top brokerages to pump money into a government-backed market stabilization fund operated by the China Securities Finance Corp.
The benchmark Shanghai Composite Index shed 0.2 percent to settle at 3160.17 points.
It has slumped 39 percent since a mid-June high despite government measures to try to halt the rout.
A report in yesterday’s Securities Times said 50 brokerages, including CITIC Securities, Haitong Securities and Guotai Junan Securities Co, will provide 100 billion yuan (US$15.7 billion) to the stabilization fund, which will be invested in blue-chip shares.
However, the news didn’t prevent more than 300 stocks hitting the daily-limit decline of 10 percent on the Shanghai and Shenzhen exchanges.
Banks did well in the afternoon with the Industrial and Commercial Bank of China, the world’s biggest lender by assets, rising by the daily limit of 10 percent and the Agricultural Bank of China up 6.7 percent.
“The market hasn’t bottomed out yet as pessimism prevails,” said Wang Fen, an analyst with Shanghai Securities. “Without the support of state funds, it will continue to fall.”
China’s stock markets will be closed today and tomorrow as the country commemorates the 70th anniversary of the end of World War II and victory in the Chinese People’s War of Resistance Against Japanese Aggression.