Shanghai index falls 3.3 pct, tracks global losses

SHANGHAI, China - Chinese shares ended the week near a 21-month low on Friday, as investors took cues from Wall Street's overnight tumble amid growing uncertainty over the economic outlook.

The benchmark Shanghai Composite Index fell 3.3 percent, or 74.96 points, to 2,202.45, its lowest close since Dec. 12, 2006. The Shenzhen Composite Index of China's smaller, second index sank 3.7 percent to 608.18.

Selling was heavy across the board, with PetroChina, the Shanghai index's biggest traded share, falling 4.2 percent to 11.94 yuan.

Although the markets took a breather from near constant losses the day before, the 2.99 percent drop in the Dow Jones Industrial Average on Thursday reinforced the sense of pessimism that has prevailed for months.

"The recent continuous declines caused panic," said Zhu Kangping, a strategist at Shenyin Wanguo Securities in Shanghai. "Today most securities shares slumped over 5 percent as investors feel hopeless about the market."

Refiners, property firms and banks were also among the heaviest losers.

China Petroleum & Chemical Corp., also known as Sinopec, dropped 1.59 percent, to 9.88 yuan.

Real estate companies fell following a report that housing prices in Shanghai fell 24 percent from a year earlier in July. China Vanke Ltd., the country's biggest developer, shed 6.4 percent to 3.78 yuan, while rival Poly Real Estate Group dropped 6.6 percent to 13.35 yuan.

Banks extended losses, with Industrial & Commercial Bank of China Ltd., China's biggest commercial lender, losing 2.8 percent to 4.51 yuan. China Construction Bank Ltd. fell 2.95 percent to 4.93 yuan.

Nonferrous metals fell back after Thursday's rebound, with Zhongjin Gold Co. down 5.8 percent at 26.08 yuan. Jiangxi Copper Ltd. tumbled 6 percent to 15.10 yuan, while aluminum giant Chinalco, or Aluminum Corp. of China, dropped 4.3 percent to 9.30 yuan.

In currency markets, the U.S. dollar was trading at 6.8393 yuan around 0900 GMT on the over-the-counter market, up from Thursday's close of 6.8371.

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