SHANGHAI May 2 China stocks fell on the first
trading day in May, with investors kept at bay by worries over
tighter regulation and weaker-than-expected economic indicators.
The blue-chip CSI300 index fell 0.4 percent, to
3,426.58 points, while the Shanghai Composite Index
dropped 0.3 percent to 3,143.71 points.
Growth in China's manufacturing sector slowed faster than
expected in April, an official survey showed on Sunday, as
producer price inflation cooled and policymakers' efforts to
reduce financial risks in the economy weighed on demand.
A private manufacturing survey on Tuesday echoed the
official take, finding China's factory sector had lost momentum
last month, with growth slowing to its weakest pace in seven
months as domestic and export demand faltered.
Such downbeat surveys could curb sentiment, as economic
growth has been a major concern for investors, said Xiao Shijun,
an analyst at Guodu Securities.
The official Xinhua news agency on Monday cited Xu Zhong,
head of the People's Bank of China's (PBOC) research bureau, as
saying the country needed to deleverage at a "proper pace" to
reduce financial sector debt and avoid systemic financial risk.
Tightening financial regulations could continue to hurt
risk appetite in the medium to long term, Gao Ting, head of
China strategy at UBS Securities, wrote in a research note.
Most sectors lost ground, dragged down by real estate
, and bank stocks, after China's biggest
listed banks posted results that showed shrinking interest
However, stocks expected to benefit from the development of
the newly-launched Xiongan New Economic Zone outperformed; more
than a dozen of these shares surged by the maximum allowed, on
signs tough regulation against speculation in the Xiongan
investment theme may have eased somewhat.
(Reporting by Luoyan Liu and John Ruwitch)