China's shares closed down on Monday as investors sold two listed brokerages after an official newspaper reported regulators were probing illegal asset management products by a raft of securities houses.
The benchmark Shanghai composite index, grouping hard-currency B shares and yuan-denominated A shares, finished 1.62 percent lower at 1,517.145 points.
Authorities were probing new asset management products offered by many brokerages, the official Shanghai Securities News said on Monday. That further weakened a market already concerned over efforts to gently slow the economy.
Index heavyweight CITIC Securities, the most profitable securities house in 2003 shed 3.6 percent to close at 7.43 yuan. Smaller Hongyuan Securities fell 2.7 percent to 6.17 yuan.
"The market was also weighed down by the weak performance of petrochemical and steel large-caps, whose prospects are perceived to be dimming due to the credit tightening," said analyst Chen Dong at MF Securities.
Sinopec Corp, Asia's largest refiner, fell 2.9 percent to 4.74 yuan. Maanshan Iron and Steel shed 2.1 percent to 4.57 yuan.
The Shanghai index has dived nearly 15 percent since early April, hit by government-ordered clampdowns on excess lending aimed at cooling an economy that grew 9.8 percent in the year through the first quarter.
More recently, the key index has also been bruised by a funds outflow after the Shenzhen stock exchange launched a long-awaited board for small- and mid-sized companies, viewed as a precursor to an eventual Chinese Nasdaq-type market.
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