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Shanghai Composite down 3.1% in morning trading
Aggregated Source: Shanghai Daily: Business

SHANGHAI stocks plunged in the first trading session after a three-day Dragon Boat Festival holiday as data released over the weekend pointed to a slackening economic growth in China.

The key Shanghai Composite Index lost 68.09 points, or 3.1 percent, to 2,142.81, the lowest level since December. Turnover was 45.9 billion yuan (US$7.5 billion) by the noon break.

The latest data suggested that the world's second largest economy is losing momentum as reflected in weaker-than-expected consumer prices, lackluster foreign trade, slowing industrial production and tight money supply.

Exports rose a meager 1 percent in May, down from double-digit growth rates in months before China began to crack down on hot money inflows. Imports posted a 0.3 percent decline, a fresh sign of waning domestic demand.

The World Bank yesterday cut its 2013 economic growth forecast for China to 7.7 percent, down from its earlier estimate of 8.4 percent because Chinese policymakers are shifting from investment-fueled growth to consumption-led growth.

Cement producers tumbled the most. Anhui Conch Cement Co, China's biggest cement producer, fell 6.5 percent to 14.78 yuan. Gansu Qilianshan Cement Group Co slid 4 percent to 10 yuan.

Poly Real Estate, China's second-largest developer, lost 3.9 percent to 11.07 yuan. Gemdale Corp decreased 4.2 percent to 6.76 yuan.

Financial stocks also declined. ICBC, the nation's biggest lender, shed 2.2 percent to 4.08 yuan. China Merchants Bank tumbled 4.4 percent to 11.99 yuan.

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Copyright Shanghai Daily: Business