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China stocks fall as blue chips hit by renewed worries over influx of new shares

China stocks fall as blue chips hit by renewed worries over influx of new shares

Chinese shares fell Thursday on renewed concerns that corporate fundraising plans might flood the markets with new shares, straining liquidity.
The benchmark Shanghai Composite Index fell 0.8 percent, or 34.53 points, to 4,299.51. The Shenzhen Composite Index rose 1.3 percent to 1,356.61.
An announcement by Shanghai Pudong Development Bank that it was scaling back the size of a proposed additional share offering failed to reassure investors jittery over other large firms' fund-raising plans, analysts said.
Blue chips led the market's drop, with Air China falling 3.3 percent to 18.28 yuan and China United Telecommunications off 2.8 percent at 10.39 yuan.
Shanghai Pudong Development Bank rose 0.7 percent to 40.89 yuan after it said late Wednesday it plans to sell up to 800 million additional shares on the domestic market, less than the 1 billion shares it had originally targeted.
Investors are also cautious over potential policy changes that could emerge during the annual session of the national legislature, the National People's Congress, and a parallel advisory body, the Chinese People's Political Consultative Conference, which convene in Beijing next week.
Major policy and regulatory changes could emerge during their meetings.
"We anticipate the main board will be relatively stable until the NPC and the CPPCC take place," said Chen Huiqin, an analyst at Huatai Securities.
In currency dealings, the U.S. dollar's weakness against the euro helped push the Chinese yuan to a record high against the greenback.
The dollar was at 7.1149 around 0730 GMT on the over-the-counter market, down from Wednesday's close of 7.1420. During trading it dropped to 7.1148, its lowest level against the Chinese currency since the current exchange rate system was established.