China's main stock index fell 1.07 percent on Thursday, tracking a slump in overseas markets on the global economy's grim prospects, but gains in property shares spurred by a policy support package pulled the index from its lows. The benchmark Shanghai Composite Index closed at 1,875.561 points, its lowest close since November 2006 and extending the previous day's 3.2 percent slump.
It recovered from the day's low of 1,828.308, however, after holding above a nearly two-year intraday low of 1,802 hit in mid-September, when the government intervened with a market rescue package. Some investors consider that a strong technical support level. Falling stocks in Shanghai outnumbered gainers by 579 to 319. Turnover in Shanghai A shares was light at 32.9 billion yuan ($4.8 billion), although up slightly from Wednesday's 32.2 billion yuan.
Most property stocks rose after China late on Wednesday announced a series of policy changes, including tax cuts, to encourage home purchases. China Vanke, the country's biggest listed developer, gained 4.39 percent to 6.89 yuan.
Banking shares fell on expectations that lenders may report a sharp slide in profit growth for the third quarter due to a slowing economy and rising corporate defaults. Industrial and Commercial Bank of China, the country's biggest lender, fell 2.81 percent to 3.80 yuan. Oil refiner PetroChina slumped 4.99 percent to 10.66 yuan.China Railway Group tumbled 5.94 percent to 4.75 yuan.