Chinese stocks down on lowered GDP target

Chinese shares closed lower on Monday after Premier Wen Jiabao announced an economic growth target of 7.5 percent for this year, the lowest since 2004. The benchmark Shanghai Composite Index closed at 2,445, down 15.69 points, or 0.64 percent, from the previous close. The Shenzhen Component Index dropped 73.5 points, or 0.71 percent, to end at 10,226.44. Combined turnover on the two bourses expanded to 206.65 billion yuan (32.74 billion U.S. dollars) from 182.93 billion yuan the previous trading day. Losers outnumbered gainers by 486 to 397 in Shanghai and by 692 to 671 in Shenzhen. China has set its GDP growth target at 7.5 percent this year, down from 8 percent in 2011, according to a government work report delivered by Premier Wen Jiabao at the parliament's annual session Monday. The government lowered its economic growth target after keeping it around 8 percent for seven consecutive years. Analysts said the government's move reflected its determination to shift its focus to quality growth, but it will weigh on the stock market in the short term. Chinese developers led the drops as the government on Monday voiced its determination to continue its squeeze on the property market. China Vanke, the country's largest property developer by market value, dropped 1.39 percent to 8.51 yuan per share, while Poly Real Estate, the country's second largest developer, lost 1.12 percent to 11.5 yuan. Banks were also among the poorest performers on Monday. The Industrial and Commercial Bank of China, the country's largest state-owned bank by market value, dropped 1.13 percent to 4.38 yuan, while China Construction Bank declined 1.02 percent to 4.84 yuan.