China's main stock index fell on Tuesday because of concern about the weakness of the US financial system, but it came off its lows after nearing major technical support. The Shanghai Composite Index ended down 1.05 percent at 2,071.431 points, after hitting a one-month low of 2,037.024 in the morning. Analysts see strong support around 2,000 points, which was resistance in late December and January.
Turnover in Shanghai A shares rose to 79.8 billion yuan ($11.7 billion) from Monday's one-month low of 72.0 billion yuan, but remained below its levels for most of the past month. Gaining Shanghai A shares narrowly outnumbered losers by 477 to 437, but heavily weighted financial, coal and non-ferrous metal shares dragged down the main index, partly on worries that the turmoil in the United States could mean long-term weakness in demand for commodities.
Merchants Bank slipped 3.90 percent to 14.12 yuan after rising 2.45 percent on Monday. A total of 4.8 billion Merchants Bank shares became newly tradable on Monday when a final lock-up period for institutional investors expired.
Pudong Development Bank sank 3.86 percent to 16.94 yuan. Chairman Ji Xiaohui told Reuters that it had held talks with Citigroup about the possible disposal of Citigroup's nearly 4 percent stake in the Chinese bank, though Ji said this would not affect its business. Leading coal producer China Shenhua Energy slid 2.02 percent to 18.45 yuan, while Jiangxi Copper sagged 1.74 percent to 15.20 yuan.
However, Baoshan Iron & Steel Co, the top steel maker, rose 1.90 percent to 5.35 yuan after news that it had cut prices for major hot-rolled and cold-rolled steel products. Industry website Mysteel said the company had cut prices by 4.7 percent for cold-rolled steel and 5.3 percent for hot-rolled products, but cuts had been expected by the market and were apparently not as steep as some had feared.
SAIC Motor, the biggest car maker, jumped 8.55 percent to 8.52 yuan, while Shandong Lukang Pharmaceutical soared its 10 percent daily limit to 4.52 yuan after announcing an internal restructuring of some of its units. Among other gainers on Tuesday, Xi'an Aircraft International surged 10 percent to 22.20 yuan.
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