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2nd LD-Writethru: Chinese shares close lower Monday

Xinhua, June 15, 2015 Adjust font size:

Chinese shares closed lower on Monday, with the benchmark Shanghai Composite Index down 2 percent to finish at 5,062.99 points, and the Shenzhen Component Index slipping by 2.19 percent to close at 17,702.55 points.

The ChiNext Index, China's Nasdaq-style tracking board of growth enterprises, slumped by 5.22 percent to end at 3,696.03 points.

The losers outnumbered gainers by 605 to 315 in Shanghai, and by 951 to 429 in Shenzhen. Total turnover on the two bourses expanded slightly to around 1.20 trillion yuan (325.98 billion U.S. dollars) from the 1.97 trillion on Friday.

Stocks related to the Internet, ship building, software and banking were among the biggest losers. China Merchants Bank lost 3.99 percent to end at 19.50 yuan per share. CSSC Offshore & Marine Engineering (Group) Co.slumped by 7.90 percent to close at 69.99 yuan.

Bucking the trend, 127 shares on the two bourses surged by the daily limit of 10 percent. Shares related to the steel and iron industry, electricity, shipping, real estate and wine making made robust gains.

Xinyu Iron & Steel Co. surged by 10 percent to end at 10.45 yuan per share. Yuan Cheng Cable Co. gained 5.76 percent to close at 31.20 yuan.

The benchmark Shanghai Composite Index opened higher in the morning, but fell nearly 2 percent soon after the opening bell.

Market regulator China Securities Regulatory Commission (CSRC) on Saturday banned illicit loans for stock purchases, and announced that margin trading outside the brokerage system would be strictly punished.

Meanwhile, 25 IPOs are scheduled for this week, with the amount of frozen capital in China's A-share market hitting a new high. Nearly 42 billion yuan is expected to be raised.

Zhu Zhenxin, an analyst with Minsheng Securities, predicts the new wave of IPOs will weigh on the market as liquidity will be greatly drained, but tightening will ease after money gradually gets unlocked.

The benchmark Shanghai index has risen by around 60 percent this year from the 3,234.68 points registered on the last trading day of 2014. The total market value of the companies listed on the two bourses extended to about 10 trillion U.S. dollars last Friday, another historical high.

The gain alone is bigger than Japan's entire equity market value of 5.1 trillion dollars, making China's stock market the world's second largest after the U.S., which has a market value of 25 trillion dollars. Endi