Chinese shares edged down 0.49 percent on Monday as investors locked in profits in recent gainers such as Merchants Bank Co in the run-up to the long Labour Day holiday.
The benchmark Shanghai composite index closed at 1,409.786 points, after hitting its highest level in more than 18 months on Friday.
Investors became more cautious as the week-long Labour Day holiday - which kicks off on May 1 - draws near, largely on concerns that policy changes could affect the market.
"They are just playing safe now and locking in as much profit as possible before it's too late," said Zhou Lin, an analyst with Huatai Securities. Beijing said last week that it would soon allow firms to resume capital raising on domestic stock markets, ending a year-long ban imposed since it kicked off a programme to sell over $250 billion state holdings in listed firms last May.
The major index has jumped over 21 percent so far this year, as technical factors and financial reforms draw investors back following a four-year market slump.
But the resumption of new share issues, expected in coming weeks, could eat into liquidity and dampen investor confidence, analysts say. Top Shanghai-listed lender Merchants Bank dived 2.25 percent to 6.53 yuan. Smaller rival Minsheng Banking Corp, which chalked up big gains this month, shed 2 percent to 3.93 yuan.
Bucking the trend, China United Telecommunications Corp, the smaller of China's two mobile carriers, closed up 2.15 percent at 2.85 yuan.
Comments
Comments are closed.