Financial, steel shares lead fall after three-day rally

Domestic shares fell on Wednesday, led by declines in financial and steel companies, the Wall Street Journal reported. After rising for three straight sessions, the Shanghai and Shenzhen composite indexes fell by 1.1%, or 34.02 points, and 0.4%, or 4.56 points, respectively. The financial sector suffered the biggest losses as some institutional investors – concerned about a tightening in bank loans in the remaining months of this year – reduced their holdings. Bank of Communications fell 3.1% to RMB9.05 (US$1.32) and Everbright Securities was down 2.2% at RMB23.61 (US$3.45). Metal producers, which led the three-day rise in share prices, also suffered yesterday, with Baoshan Iron and Steel down 3.1% at RMB7.31(US$1.07) and Wuhan Iron and Steel falling 3.1% to RMB8.36 (US$1.22). Despite the fall, analysts expect the Shanghai Composite Index to remain stable and consolidate at around 3,000 points ahead of the National Day holiday on October 1.