Banks lead declines as Shanghai shares fall 3.1%

Shares in Shanghai fell 3.1% on Tuesday to close at 2,651.61, the Wall Street Journal reported. The fall in the Shanghai Composite Index left it at its lowest level since February 5, 2007, and follows the completion of the worst-ever month for China’s benchmark CSI Index last month. Banks fell sharply after People’s Bank of China Governor Zhou Xiaochuan said on Monday that interest rate increases remained a possibility. The approval of initial public offerings by China South Locomotive & Rolling Stock and Everbright Securities also had investors worrying about the market’s ability to absorb new issues.