China's shares reversed an early bounce to end down 0.24 percent on Tuesday, with the key index hitting its lowest level in nearly six years for a second day as investors dumped firms expected to post poor results. The benchmark Shanghai composite index finished at 1,188.931 points, its lowest close since May 21, 1999, when it hit 1,168.72 points. Analysts foresaw more losses ahead with sentiment extremely weak after an unremitting nine-month share slump.
"Trading was sluggish as investors were reluctant to trade amid weak sentiment," said Merchants Securities analyst Zhai Bin.
Investors were also cautious as the markets would be closed from February 7 to February 15 for the Lunar New Year holiday, and listed firms would then head into their peak 2004 corporate reporting season, brokers said.
Stocks in companies that warned of weak performances populated Tuesday's list of decliners.
Construction issue Sichuan Road and Bridge Group, which forecast a 2004 loss, was Shanghai's biggest decliner. Its yuan-denominated A shares, open to select foreign investors, plunged their 10 percent daily limit to 2.85 yuan.
Jinli Technology and Matsuoka, which forecast losses in 2004 on Monday, dived their daily limits for the second straight day, closing at 3.97 yuan and 3.55 yuan, respectively.
The index has fallen more than 6 percent since the start of 2005, after a 15 percent dive in 2004 that made it Asia's worst performer that year, hit by Beijing's economic-cooling steps, corporate scandals and a bulging pipeline of stock sales.
Hong Kong-listed Huadian Power, China's third-largest electricity producer, would list shares issued via a $233 million domestic IPO in Shanghai on Thursday.
Yangtze Power, China's most valuable generator and operator and the Three Gorges Dam, climbed 0.6 percent to 8.58 yuan after it forecast its 2004 earnings should almost double to more than $330 million, helped by capacity expansion.