Shanghai key index plunges to nearly 12-month low on Thur

China's benchmark Shanghai Composite Index dived 5.42% Thursday to nearly 12-month low, led by a huge sell-off in No.1 index component PetroChina<601857><857>.

The benchmark Shanghai Composite Index, which covers both A shares and B shares on the Shanghai Stock Exchange, plunged 5.38% or 194.93 to 3,411.49 points after fluctuating between 3,541.28 and 3,407.90 points, the lowest close since Apr. 9, 2007.

Similarly, the Shenzhen Component Index on the smaller Shenzhen Stock Exchange moved down 2.80% or 377.68 points to 13,111.41 points.

The combined turnover on the two bourses climbed to RMB 112.02 billion from RMB 104.7 billion of the previous trading day.

The drop came on the heels of an overnight loss in Wall Street. And news that several stocks have dropped below or near their IPO price also contributed to the market decline.

PetroChina plummeted 8.31% to RMB 16.99, near its IPO price of RMB 16.7, and 65% off its record high of RMB 48.62 on its Shanghai debut on Nov. 5. It said last week net income rose at a disappointing annual rate of 2.4% last year. Another oil giant Sinopec<600028><386>, Asia's largest refiner, dropped 8.45% to RMB 11.38 as crude oil prices surged on weak dollar and U.S. inventories.

China Pacific Insurance<601601> fell another 7.47% to RMB 25.89. It lost 8.11% to RMB 27.98 on Wednesday, below its IPO price of RMB 30 for the first time, after 300 million shares became tradable as a lock-up period expired.

China Shipping Container Lines Co<601866><2866> and China Coal Energy<601898><1898> also broke their IPO prices. The former shed 5.65% to RMB 6.51, below its IPO price of RMB 6.62. The latter plunged 9.93% to RMB 16.69, below the IPO price of RMB 16.83.

However, property sector jointly made a pleasing performance yesterday partly due to a rally in developers on the Hong Kong market. China Vanke<000002><200002> gained 1.77% to RMB 24.66 after rising more than 5% at a time in the session and Gemdale<600383> added 4.88% to RMB 37.17.

As a whole, losers outweighed gainers by 811 to 38 in Shanghai and 634 to 37 in Shenzhen.