Suning hits skid as local stocks drop

　　The Shanghai and Shenzhen stock markets opened the week with huge losses Monday, as concerns over the domestic economy continue to cloud investor sentiment.

 

　　The Shanghai Composite Index declined 37.94 points, or 1.74 percent, to close at 2,147.95; while the Shenzhen Component Index slumped 251.60 points, or 2.57 percent, to finish at 9,540.89.

 

　　Gains in the US markets Friday carried both markets to open higher Monday, although both indices gravitated downward during morning trading due to waning confidence. Only brewing and traditional Chinese medicine stocks performed well in early trading, while the heavily weighted electronics, manufacturing, environmental protection and solar energy sectors suffered heavy losses throughout the day.

 

　　Sunning Appliance, one of the largest privately owned electronics and appliance retailers in China, plunged to the day limit to finish at 7.28 yuan （$1.14）。

 

　　Analysts say a slew of profit warnings were behind losses for many big name firms Monday and have deepened investor concerns about the domestic economy. "There's going to be more of such profit warnings in the next few weeks, leading up to the earnings season in August. Even with policy easing, it's going to take a while before earnings improve," according to a report by Reuters Monday, citing Jackson Wong, Tanrich Securities' vice-president of equity sales.

 

　　Premier Wen Jiabao said during a meeting in Sichuan Province over the weekend that the economic challenges facing the country will persist for a while longer and the government will step up efforts in the second half of the year to stabilize growth.