Chinese shares plunge

China's shares closed down 0.08 percent on Monday as investors cashed out of index heavyweights such as Baosteel. The benchmark Shanghai composite index, grouping foreign-currency B shares and local-currency A shares, finished at 1,319.533 points after racking up its lowest level since November 13, 2003, in intraday trade.
The index has shed more than a quarter since early April, hit mainly by official economic-cooling measures.
Over the past two weeks, the market has also been affected by plans for a huge stock offer from Baosteel, or Baoshan Iron and Steel Co Ltd, the world's fifth most valuable steel-maker.
Baosteel aims to raise up to $3.7 billion to buy mills and other assets from its parent in what could be the largest fund-raising exercise on a mainland exchange. The move has sparked worries it will divert funds from shares in other firms.
Its own A shares, open to select foreign investors, were among Monday's most actively traded, ending 0.8 percent lower at 6.20 yuan. The shares have lost 8.2 percent since August 12, when it announced its fund-raising.
China Merchants Bank Co Ltd, the country's largest listed lender, was also active and slipped 0.7 percent to 9.12 yuan.
China United Telecommunications Co Ltd, the smaller of China's two wireless operators, fell 0.6 percent to 3.36 yuan.
Beijing has taken a series of measures since late last year to try to cool the economy, including boosting bank reserve requirements and restricting credit to some industries.
Analysts said the index might recover somewhat this week as it approached the psychologically key 1,300-point level.
"Monday's trading indicated the market lacked momentum to fall further," said analyst Qian Qimin at Shenyin & Wanguo Securities. "Technical charts showed the index might rebound."
For instance, the 14-day relative strength index for the Shanghai composite index has now dipped below a reading of 30 - the oversold mark.
On Monday, Sinopec Corp, Asia's top oil refiner, gained 0.2 percent to end at 4.62 yuan, outperforming the market after it posted a first-half profit leap of more than 50 percent.