China: Stocks correct on profit-taking, joining regional markets

[SHANGHAI] China stocks weakened on Thursday as investors took profits following a sharp rally in the previous two days, falling in step with regional markets led lower by Wall Street.

There were few signs of panic in the retreat. Chinese Premier Li Keqiang reassured global markets on Wednesday that Beijing can keep its economy on track and stock markets in check.

The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 1.2 per cent, to 3,357.56, while the Shanghai Composite Index lost 1.5 per cent, to 3,197.89 points.

The session was dominated by some profit taking after the market posted a combined 5 per cent gain during the previous two days, analysts said.

There were also signs of investors deleveraging.

Major stock markets in the region fell, with Japan's Nikkei index falling over 2 per cent, while the Taiwan market lost 0.2 per cent.

Inflation data published on Thursday showed persistent weakness in producer prices in August, analysts said, but it had little impact on the market.

Banking shares ended the session up, outperforming the market.

Small-caps fell, with Shenzhen's growth board ChiNext down 1.4 per cent.

Brokerages underperformed, impacted by forecasts for lower trading volumes.

REUTERS