SHANGHAI - Chinese share prices opened 6.12 percent lower on Thursday as investors reacted to a sharp retreat on Wall Street overnight, dealers said.
They said investors' already weak confidence took another beating after the decline on Wall Street with the Dow Jones Industrial Average down 2.36 percent, shrugging off the Fed's recent rate cut.
Shortly after 10:30 am (0230 GMT), the benchmark Shanghai Composite Index, which covers both A and B shares, had shed 230.25 points to 3,531.35.
The Shanghai A-share Index fell 241.61 points or 6.12 percent to 3,706.32 points, while the Shenzhen A-share index was down 62.07 points or 5.27 percent at 1,116.64.
"The weak Wall Street showed that the Fed's move cannot immediately fix the economic problems, and the subprime crisis will continue to weigh on the market," said Guo feng, an analyst with North East Securities.
Meanwhile, a large cash call could also weigh on the market after mid-sized Pudong Development Bank received the majority shareholders' nod for a refinancing plan which can sell up to 800 million new shares.
"This type of massive share issue weakens market sentiment as investors were worried the refinancing plan will further drain liquidity," Guo added.
lsl/ph/lh
03/20/2008 03:23 GMT