Industrial & Commercial Bank Ltd., the nation's biggest listed lender, also known as ICBC, and China Construction Bank Corp., the second-largest, both plunged by the 10 percent daily limit. China yesterday cut interest rates for the first time in six years and allowed most banks to set aside smaller reserves, prompting Poly Real Estate Group Co. to jump 4.8 percent.
The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, declined 77.19, or 3.7 percent, to 2,000.65 at the close, the lowest since Dec. 28, 2006. It dropped to as low as 1,987.30, falling below 2,000 for the first time in almost 21 months. China's markets were shut yesterday for a holiday, when the MSCI Asia Pacific excluding Japan Index fell 1.9 percent.
Central bank efforts to cool inflation and concern about a slowdown in global demand for the nation's products have helped drive the CSI 300 down 63 percent this year, allowing France to overtake China as the world's fourth-largest stock market. The slump has made China the second-worst performing stock market in 2008.