Shanghai key index ends the month greatly lower

Shanghai key index erased gains achieved last Friday to drop below 3,500 points again on Monday after securities regulators failed investors' expectation that they might introduce stimulus measures.

The benchmark Shanghai Composite Index, which covers both A shares and B shares on the Shanghai Stock Exchange, slumped 3% or 107.43 to 3,472.71 points after fluctuating between 3,555.82 and 3,445.56 points, trimming a gain of nearly 5% last Friday.

Similarly, the Shenzhen Component Index on the smaller Shenzhen Stock Exchange moved down 2.85% or 390.71 points to 13,302.14 points after touching an intraday high of 13,620.82 points.

The combined turnover on the two bourses booked a notable decrease to RMB 97.4 billion from RMB130.9 billion of the previous trading day. By the month end, the Shanghai key index has dropped 20.14% in March, the highest monthly slump sine July 1994.

Reports on Sunday said the China Securities Regulatory Commission had urged fund companies to stay cool amidst market changes and stick to long-term investment to help maintain stability of the capital market.

Most components in top 10 heavyweights witnessed losses. PetroChina, the biggest component of the index, slid 3.64% to RMB 17.22. China Life, the biggest insurer, dropped 3.71% to RMB 28.27 and China Shenhua Energy Co, the nation's biggest power generator, plunged 5.99% to RMB 40.

However, coal, airline and banking sectors still made a pleasing performance despite the dropping market. Sinopec, the largest oil refiner, moved up 1.34% to RMB 12.13. Industrial & Commercial Bank of China, the nation's biggest lender, edged up 1.32% to RMB 6.13 and Air China added 0.18% to RMB 16.58.

As a whole, losers outweighed gainers by 773 to 69 in Shanghai and 613 to 59 in Shenzhen.