BEIJING, Sept. 26 (Xinhua) -- China's stocks continued to fall on Monday, dragged down by concerns over the country's ongoing monetary tightening policies and a panic sell-off that weighed on financial stocks.
The benchmark Shanghai Composite Index lost 1.64 percent, or 39.98 points, to close at 2,393.18 points, its lowest level since July 5 last year.
The Shenzhen Component Index dropped 1.99 percent, or 209.92 points, to finish at 10,328.47.
Combined turnover on the two bourses shrank to 107.25 billion yuan (16.77 billion U.S. dollars) from 123.5 billion yuan on the previous trading day.
Losers outnumbered gainers by 829 to 87 in Shanghai and by 1,141 to 181 in Shenzhen.
Zhou Xiaochuan, governor of the People's Bank of China, said over the weekend that China still faces pressure from price increases and an increased influx of capital, adding that the government will continue to work to keep prices stable.
Zhou's comments renewed market concerns that the country's policies to combat inflation may slow down economic growth, analysts said.
However, the biggest factor in Monday's drop was a decrease in financial stocks. A panic selloff of the Ping An Insurance Co.'s stocks triggered other drops by financial companies over speculation that shareholder HSBC Holdings might sell its own stock in the company.
The Ping An Insurance Co. dropped 9.58 percent to 34.37 yuan per share, bringing the China Pacific Insurance (Group) Co. down with it by 7.08 percent to 18.65 yuan.
Alcohol producers also contributed to the market drop due to media reports that the National Development and Reform Commission, the country's top economic planner, has asked alcohol producers to stabilize their prices.
The Jiangsu Yanghe Brewery fell 2.64 percent to 133 yuan, while the Luzhou Laojiao Company slid 2.75 percent to 38.88 yuan.
source:xinhua