Chinese shares tumble

China shares closed down 1.02 percent on Monday after hitting their lowest levels in nearly nine months as selling in technology companies overwhelmed a weak bounce by top steel maker Baosteel.
The benchmark Shanghai composite index, grouping foreign-currency B shares and local-currency A shares, finished at 1,354.511 points after recording an intraday trough of 1,350.839, the lowest since November 20.
Baoshan Iron and Steel Co Ltd, the world's fifth most valuable steel-maker, staged a mild rebound. Its A shares, open to select foreign investors, ended up 0.6 percent at 6.21 yuan after having dived 8.6 percent on Friday on a fund-raising plan.
Baosteel aims to raise potentially up to $3.7 billion to buy mills and other assets from its parent in what could be the largest fund-raising exercise to hit mainland exchanges.
Investors fretted that plans to swallow up those assets would hit profitability amid concerns they were of inferior quality to current assets. They were also worried the huge issue would divert funds from shares in other companies, analysts said.
"Sentiment was weak as fears over the negative impact from Baosteel's huge stock offer continued to hang over the market," said Zheng Weigang, a senior analyst at Shanghai Securities.
Telecommunications equipment maker Beijing C&W Technology Co Ltd was the day's top decliner in Shanghai, diving its 10 percent daily limit to 5.20 yuan.
"Technology stocks dived today because interest has faded in a new board aimed at such stocks," Zheng added.
Launched on June 25 in Shenzhen and known as the Small and Medium Enterprises Board, it carries the same stringent listing criteria required by the main market - for now.
But Beijing hopes it will grow in size and pave the way towards a true Chinese Nasdaq to help start-ups raise cash.
Button producer Zhejiang Weixing Industrial Development Co Ltd, one of the first eight firms to make use of the board, was Shenzhen's top loser on Monday.
It dived its 10 percent daily limit to 9.60 yuan.
Analysts say the market is likely to test the psychologically key 1,350-point level again on Tuesday, after bouncing off that support in Monday's trade.
The Shanghai composite index has fallen 23.8 percent since early April, hit mainly by Beijing's steps to cool a racing economy that has diverted funds from the market.