China Stocks Fall on Tightening Concern, Oil

Chinese stocks fell, dragging the CSI 300 Index from a seven-week high, on concern the government will impose more measures to tame inflation and record oil prices will hurt profits., Bloomberg 5/6/2008 6:56:52 AM

China Merchants Bank Co. led declines by banks after Vice Finance Minister Li Yong said yesterday, after markets shut, the economy is at risk of overheating and Central Bank Governor Zhou Xiaochuan reiterated that interest rates may be raised to curb inflation. Air China Ltd. led a retreat by airlines as crude oil topped $120 a barrel.

The CSI 300, which tracks yuan-denominated A shares listed on China's two exchanges, fell 44.89, or 1.1 percent, to 4,010.89. The benchmark, which closed yesterday at the highest since March 14, rose as much as 0.5 percent and dropped 2.3 percent. About three stocks dropped for each that advanced.

The gauge gained 24 percent between April 21 and yesterday, spurred by a cut in the stamp duty on securities transactions and speculation the government will restrict additional share sales.

The Shanghai Composite Index, which tracks the larger of the nation's two exchanges, declined 0.7 percent to 3,733.50. The Shenzhen Composite Index fell 0.7 percent to 1,122.65

China Stocks Fall on Tightening Concern, Oil