SHANGHAI stocks tumbled yesterday after China's strongest earthquake in 58 years killed more than 12,000 people and caused severe damage in southwestern Sichuan Province.
The Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B shares, dived 1.85 percent, or 66.96 points, to close at 3,560.03. Turnover rose to 123 billion yuan (US$18 billion) from 116.7 billion yuan on Monday. Losers outnumbered gainers by 477 to 324 with 106 stocks unchanged.
Insurance stocks led the decline as the 7.8 magnitude quake is likely to eat into insurers' profits but analysts expected the disaster would increase insurance awareness and help support China's disaster insurance industry in the long run.
China Life Insurance Co lost 4.73 percent to 31.63 yuan per share and China Pacific Insurance tumbled 7.18 percent to 24.69 yuan.
Ping An Insurance was suspended from trading yesterday. Its shareholders approved its plan to issue additional H shares of no more than 20 percent of the insurer's existing shares in the Hong Kong market.
PetroChina lost 2.63 percent to 17.39 yuan and China Petroleum & Chemical Corp dropped 2.32 percent to 11.81 yuan. The two companies said the earthquake didn't impact its operation greatly.
The cement and pharmacy sectors rose as materials will be widely used in the quake-hit areas, analysts said.
Anhui Conch Cement Co jumped 5.45 percent to 64.19 yuan, Hebei Taihang Cement Co surged to the daily limit of 10 percent to end at 6.33 yuan and Fujian Cement Inc also jumped 10 percent to 8.35 yuan.
Shanghai Pharmaceutical Co gained 9.96 percent to 9.83 yuan and Beijing Wandong Medical Equipment Co rose 10 percent to 13.75 yuan.
Banks fell after the central bank ordered lenders to set aside a record 16.5 percent in deposits as reserves, which will freeze about 208 billion yuan in the banking system.
Despite the index's tumble, the market was generally stable yesterday as some sectors performed well, and the quake incident is not likely to prevent the market from rising in future, according to Wanlong Securities.
A total of 66 listed firms based in Sichuan Province and Chongqing, including Sichuan Road & Bridge Co and Chongqing Iron & Steel Co, had their shares suspended from trading yesterday in Shanghai and Shenzhen.