China shares sluggish despite signs of govt support, ChiNext jumps

HONG KONG Wed Jan 8, 2014 2:07am EST

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HONG KONG Jan 8 (Reuters) - China shares stayed sluggish on Wednesday, with the Shanghai index at a five-month closing low as weakness in coal counters outweighed strength in insurers and small-cap stocks despite signs of government support.

Investors are bracing for a flood of new A-share listings at a time of tightening money supply. Shaanxi Coal Industry Co said on Tuesday it plans to raise 9.8 billion yuan ($1.62 billion) in what would be China's largest initial public offering since late 2011.

The CSI300 of the biggest Shanghai and Shenzhen A-share listings eked out its first daily gain in 2014, ending up 0.2 percent at 2,241.9 points. The Shanghai Composite Index slipped 0.2 percent, closing at its lowest since Aug. 2. Volumes stayed muted.

The Nasdaq-styled ChiNext index of mainly technology start-ups listed in Shenzhen rose 3.3 percent after a Shanghai Securities News report said regulators paved the way for insurance companies to invest in firms listed on the board.

Ping An Bank rose 1.1 percent after parent Ping An Insurance raised its stake to 59 from 52 percent. The mid-sized lender raised 13.73 billion yuan by selling stock to its main shareholder to meet new banking standards and absorb an expected spike in bank loans. (Reporting by Alice Woodhouse and Clement Tan; Editing by Richard Borsuk)

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