SHANGHAI stocks dipped for the first time in five trading days amid fears of an oversupply of shares.

The Shanghai Composite Index shed 0.07 percent to 2,326.72 points, snapping a four-day winning streak. Share worth 85.4 billion yuan (US$13.8 billion) traded hands by the trading close.

The lock-up period for non-tradable shares worth 28.4 billion yuan will expire on the Shanghai and Shenzhen markets this week, a surge of 85.2 percent from last week's 15.3 billion yuan, The Securities Times reported today.

Investors are also worried the China Securities Regulatory Commission may soon resume approval of initial public offerings after it suspended IPOs last December to launch a campaign against false disclosures and profit manipulation. The campaign is scheduled to finish this month and there is speculation the regulator will give the go ahead to IPOs as early as next month.

"The market is likely to fluctuate in the short term as uncertainty over the detailed rules on housing controls, relatively tight liquidity near the month end and concern over the reboot of IPOs weigh on investors," China Merchants Securities Co said today.

As of March 15, 847 companies were waiting for regulatory approval to list on domestic exchanges, CSRC data showed.

The financial sector took a hit today.

China Pacific Insurance (Group) Co, China's third largest insurer, fell 0.7 percent to 18.72 yuan, after posting a 39 percent decline in 2012 net earnings. China Life Insurance, the country's biggest insurer, lost 0.7 percent to 17.34 yuan. Ping An Insurance Co, China's second largest insurer, slid 0.6 percent to 42.84 yuan.

Citic Securities, the biggest listed brokerage, declined 2.4 percent to 12.99 yuan. Founder Securities Co decreased 1.4 percent to 7.79 yuan. Haitong Securities Co lost 2.2 percent to 11.23 yuan.