China shares fall for 2nd day on economy doubts

SHANGHAI

Chinese shares fell for a second day led by property developers on mounting worries of an economic slow down.

The benchmark Shanghai Composite Index lost 31.87 points, or 1.2 percent, to close at 2,555.94. The Shenzhen Composite Index for China's smaller second exchange declined by 1.4 percent to 983.87.

Mounting uncertainties about China's economic growth have spooked investors amid Europe's debt woes and the country's credit tightening. A sluggish economy in Europe, China's biggest trade partner, might hurt the country's exports, analysts said.

"While the world and China's economy risk falling, buying sentiment is very low," said Mao Sheng, an analyst for Huaxi Securities in the western city of Chengdu.

Real estate shares lost ground again on news reports Shanghai might impose a property tax by the end of the year. China Vanke Ltd., the country's biggest developer, ended down 2.2 percent at 7.1 yuan, and rival Poly Real Estate Group dropped 1.5 percent to 10.55 yuan.

Gold miners were battered by lower bullion prices, with Zhongjin Gold Corp. diving 5.9 percent to 56.39 yuan, and Zijin Mining Group Co. off 3.7 percent to 7.13 yuan.

China Construction Bank Ltd. slipped 0.6 percent to 5 yuan, while Bank of China Ltd., shed 0.3 percent to 3.89 yuan. Midsize lender Pudong Development Bank Ltd. gave up 1.8 percent to 18.92 yuan.

In currency markets, the yuan weakened to 6.8276 to the U.S. dollar, down from Wednesday's close of 6.8275.

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Associated Press researcher Bonnie Cao contributed to this report.