China’s stocks retreated, paring a weekly advance, as financial companies declined before the resumption of initial public offerings after a five-month freeze.
Gemdale Corp. and Bank of China Ltd. declined more than 2 percent as a gauge of financial stocks fell for the first time in five days. Hebei Iron & Steel Co. led commodity companies lower, while China Railway Group Ltd. climbed 1.6 percent after the company announced a 11.55 billion yuan ($ 1.8 billion) asset swap with China Railway Erju Co.
The Shanghai Composite Index lost 0.9 percent to 3,551.30 at 9:57 a.m. local time. The gauge advanced 4.3 percent this week through Thursday on speculation the People’s Bank of China will extend monetary easing as the government tackles the sharpest economic slowdown in a quarter of a century. Ten Chinese companies began subscriptions for IPOs this week, the first of 28 offerings this month that could tie up 3.4 trillion yuan, according to estimates compiled by Bloomberg. China Securities Regulatory Commission has approved a second batch of 10 IPOs, according to a statement on its official microblog.
The CSI 300 Index dropped 1 percent. The Hang Seng China Enterprises Index of mainland-listed companies declined 1.4 percent, while the Hang Seng Index lost 1.1 percent.
The premium of Shanghai over Hong Kong dual-listed stocks grew to 42 percent on Thursday, the widest in three months.
Margin traders reduced holdings of shares purchased with borrowed money for a third day on Thursday, with the outstanding balance of margin debt on the Shanghai Stock Exchange falling to 701.2 billion yuan.