Shanghai's key stock index fell in the morning session today as airline carriers slumped after Air China reported an operating loss in the first half.
The Shanghai Composite Index declined 1.27 percent, or 29.76 points, to 2,320.32 at 11:30am.
Losers in the Shanghai market outnumbered gainers 773 to 54 while two did not change.
The Shenzhen Composite Index, which tracks the smaller domestic stock exchange, was down 1.95 percent, or 12.58 points, to 633.89.
Air China Ltd, the nation's largest international carrier, shed 3.55 percent to 5.43 yuan (79 US cents). China Southern Airlines, the biggest in fleet size, lost 2.13 percent to 5.06 yuan while China Eastern declined 6.94 percent to 4.56 yuan.
Air China reported an operating loss in the first half after fuel prices doubled and natural disasters reduced passenger numbers, the Beijing-based carrier said in a Hong Kong stock exchange statement today.
The airline's loss from operations was 335.9 million yuan, compared with an operating profit of 1.37 billion yuan a year earlier. Sales rose 9.8 percent to 25.6 billion yuan.
China's overall air travel fell in the first half, the first decline since the 2003 SARS outbreak, because snowstorms in February and an earthquake in May forced the cancellation of hundreds of flights. Airlines' fuel costs also surged, eroding the benefit of the yuan's 6.6 percent appreciation.
China Eastern said yesterday first-half profit fell 29 percent to 41.6 million yuan, as it carried fewer passengers and paid more for jet fuel.
China Southern posted a first-half profit of 847 million yuan after making a 2.64 billion yuan currency gain.
Elsewhere, China Cosco Holdings Co, the country's largest container line said it more than doubled first-half profit to 15.1 billion yuan after buying the world's largest dry-bulk fleet to tap China's surging imports of iron ore and coal. The stock fell 0.6 percent to 14.83 yuan.
China Shipping Container Lines Co, the country's second-largest cargo-box carrier, slumped 3.03 percent to 3.52 yuan. The company said yesterday its first-half profit dropped 45 percent to 637.2 million yuan after fuel costs surged and the global economic slowdown stunted demand.
Bank of Communications Ltd, China's fourth-largest publicly traded bank, slipped 1.07 percent to 7.39 yuan. The bank said yesterday second-quarter profit rose 60 percent to 7.62 billion yuan as it sold more credit cards, insurance policies and wealth management products.
The bank, part-owned by HSBC Holdings Plc, plans to establish a branch in San Francisco as it expands overseas, it said in a statement to the Shanghai stock exchange today..
The bank, with about 2,600 outlets in China, also has branches in New York, Singapore, Tokyo, Seoul and Frankfurt.
The company and Bank of China Ltd are the only two Chinese banks with branches in the United States. Industrial & Commercial Bank of China Ltd, the world's biggest by market value, this month won US Federal Reserve approval to open an office in New York City. China Merchants Bank Co, the nation's sixth-largest, was cleared in November to start operating in New York.
BoCom posted an 81 percent gain in net income in the first six months to 15.5 billion yuanas it sold more credit cards, insurance policies and wealth-management products, it said yesterday.
