Mainland stocks fall as drop in oil prices takes toll on energy sector

Chinese mainland stocks fell on Thursday, with the energy sector leading the declines after oil prices plunged more than 5 percent overnight on a spike in US crude inventories, according to media reports.

The ever- more- likely chance of a US interest rate hike this month also weighed on the markets.

China’s blue- chip CSI 300 index fell 0.63 percent to 3,426.94 points. The benchmark Shanghai Composite Index lost 0.74 percent to 3,216.75 points, while the Shenzhen Component Index closed 0.74 percent lower at 10,421.06 points.

ChiNext, the country’s NASDAQ equivalent, declined 0.54 percent to 1,953.94 points.

The energy, coal and paper making sectors were the day’s major losers, offsetting gains in both artificial intelligence and titanium dioxide shares.

China’s consumer price index, a main gauge of inflation, advanced 0.8 percent year- on- year in February, which was well below market expectations of 1.7 percent, the National Bureau of Statistics ( NBS) reported on Thursday. However, China’s producer price index, which measures costs of goods at the factory gate, jumped by its highest level since 2008.

The NBS attributed the declining CPI to a slump in food prices.

Thursday’s losses indicate that the robust rally in mainland shares since mid- January is likely coming to an end, Shen Weizheng, Shanghai- based fund manager at Ivy Capital, told Reuters.

Some experts advised investors to keep an eye on the ChiNext, which might go up slowly in the short term, according to a report on the financial news portal cnstock.com on Thursday.

In Hong Kong, the Hang Seng index fell 1.18 percent to 23,501.56 points.