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China: Stocks edge down amid concern on interest rates, growth

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[SHANGHAI] China stocks were little changed on Thursday, and trading volume shrank to near 3-1/2-month lows as many investors sat on their hands amid economic worries and revived concerns US interest rates will go up soon.

The blue-chip CSI300 index fell 0.2 per cent, to 3,062.50, while the Shanghai Composite Index was virtually unchanged, at 2,806.91 points.

Investors were cautious due the growing possibility of a US hike in June, after minutes from the last Federal Reserve meeting showed central bank officials felt the US economy could be ready for such a move.

The China market has already been sluggish recently on fears that Beijing is shifting policy away from rapid credit expansion to stimulate growth.

In further evidence there may be such a shift, the State Council, or China's cabinet, at a meeting on Wednesday, urged state-owned companies to step up efforts in restructuring and cutting excessive capacity.

Most sectors fell on Thursday, but resource shares rose, after state-owned steel and coal companies were instructed to cut production capacity by 10 per cent over 2016 and 2017, and to accelerate mergers while cutting losses.

REUTERS