Economic Observer Online
By Zhang Yong (张勇)
Feb 19, 2013
Translated by Pang Lei
Original article: [Chinese]

China's B-share market, the two foreign currency-denominated boards that operate out of both Shanghai (US dollars) and Shenzhen (HK dollars), had been on a bull run since late last year, with the Shanghai index up by over 30 percent over the past three months.

Yesterday, however, the index that tracks Shanghai's B-share market, which unlike the main bourse is open to regular foreign investors, fell by close to 5 percent. Shenzhen's B-share index was down 2.35 percent. Transactions were almost double those registered in the previous day's trading.

Falling real estate stocks also dragged Shanghai's stock index lower during trading on Tuesday, with the index closing down 1.6 percent at 2,383 points. The Shenzhen stock index fell 2.5 percent, with the price of shares in some of China's largest real estate developers like Gemdale (金地集团) and Vanke (万科) leading the market down.

Market analysts told the EO that fears that stricter housing policies would be introduced helped to drag the main index down.

Analysts also said that the turn down in the B-share index is likely to last for a while as investors look to recoup recent gains.

Today the Shanghai B-share index gained back some of yesterday's losses, closing up 1.4 percent at 274.53.

Links and Sources
Economic Observer Online: What Was Behind the Steep Fall in China\'s B-shares?