Shares ended winning streak, Xiongan stocks still strong
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E-mail Xinhua, April 10, 2017
Chinese stocks ended a four-day rising streak to close lower Monday, with growth stocks and recently listed companies suffering the most.
The benchmark Shanghai Composite Index closed down 0.52 percent at 3,269.39 points while the smaller Shenzhen Component Index fell 0.62 percent to 10,603.28 points.
The ChiNext Index, China's NASDAQ-style board, dropped 1.73 percent to close at 1,912.45 points.
Recently listed stocks saw significant losses in afternoon trading.Si-Tech Information Technology, a tech firm listed on the Shenzhen Stock Exchange in February, slumped by the daily limit of 10 percent.
Monday's losses came as regulators vowed to punish listed firms that violate market rules or fail to pay dividends when due.
Addressing a meeting of the China Association for Public Companies over the weekend, Liu Shiyu, head of the China Securities Regulatory Commission (CSRC), said listed firms that engaged in "illicit practices" on the stock market should "pay a heavy price."
He also urged listed companies to pay out dividends, promising to "act hard" against those who fail to do so without good reason.
Stocks that have paid little dividends in the past few years saw their prices drop after Liu's remarks Monday.
Despite overall bearish sentiment, shares related to Xiongan New Area, a new economic zone to be built near Beijing, continued their upward momentum.
China Fortune Land Development, an industrial city operator that had reportedly signed development agreements in the area, jumped 10 percent at opening for the fourth consecutive trading day.
Tangshan Jidong Cement, a major cement producer located near the area, also saw shares jump 10 percent on opening.
On April 1, China announced plans to create Xiongan New Area, which authorities described as a "major historic and strategic choice" that would be "crucial for the millennium to come.
Investment opportunities still abound in shares related to the area, along with those related to government strategies such as China's Belt and Road Initiative, according to Founder Securities.
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