Shanghai A-shares hit three-month low

China's stock markets fell to their lowest point since mid-August as the Shanghai Composite Index (SCI) dropped 230.07 points, or 4.4%, to close at 4,984.16 on Thursday, the Wall Street Journal reported. The SCI is now 18% down on the record high reached in mid-October. The decline in the market has been put down to a range of government tightening measures such as a moratorium on new mutual fund launches and banks have been told to cut back on lending, which has deprived the market of the money flows that sent it to successive record highs earlier in the year. While in the past investors have treated price corrections as an opportunity to buy more stocks, signals from Beijing that asset bubbles won't be tolerated, together with fears that corporate earnings will suffer as result of a slowdown in the US and Europe, have conbined to dampen spirits.