WRAPUP 1-Global market woes cast chill on China fund-raising

* Chinalco and listed unit suspend 8 bln yuan in bill issues

* Two large domestic share placements cancelled

* Analysts think govt will move to boost domestic consumption

By Lu Jianxin

SHANGHAI, Oct 17 (Reuters) - Listed Chinese firms put more than $1 billion of fund-raising plans on ice on Friday as the global credit crisis and falling share prices begin to cast a chill over China's fast-growing economy.

Chinalco, China's largest aluminium producer, and its listed unit, Chalco (601600.SS) (2600.HK), put on hold the planned issue of a combined 8 billion yuan ($1.2 billion) worth of five-year corporate bills. Traders said the move could be related to the failure of Lehman Brothers or linked to potential production cuts the company was planning. [ID:nHKG285844]

Sichuan Hongda (600331.SS), which makes zinc oxide and other chemicals, said it had cancelled a 2 billion yuan share placement while power generation equipment maker Lanzhou Great Wall Electrical (600192.SS) called off a placement worth 367 million yuan. [ID:nSHA273419]

"The weakness in the stock market is now spreading to the real economy, and the government still appears not to be doing enough," said Jin Dehuan, senior economist at the Shanghai Securities and Futures Institute.

Many analysts have long argued that falls in China's stock market, down almost 70 percent in the past year, should not have a sizeable impact on the real economy because the market is still small and the bulk of shares are not freely traded.

But so far in the second half of this year, about a dozen Chinese companies, pointing to a sharp drop in share prices, have said they would abandon or delay share-linked financing plans, including big names such as Shenzhen Development Bank (000001.SZ) which cancelled a placement with Baoshan Iron and Steel (600019.SS).

"Worse is yet to come. With the asset value of listed companies plunging so rapidly, their degree of leverage is jumping," said Jin.

"Banks worrying about the safety of their money would push these companies to repay their loans and be more reluctant to lend, causing a vicious cycle of deteriorating conditions for economic development."

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In Chinalco's case, banks underwriting the state-owned parent company's 3 billion yuan in bills said the issue was suspended because it needed to clarify rumours that could influence investors.

Britain's Telegraph newspaper has reported that shares owned by Chinalco in Rio Tinto (RIO.L) were stuck in a custodial account for Lehman Brothers in Hong Kong, and traders believed that report was behind the suspension.

While Chinese bankers and policy-makers have noted that China was largely insulated from the global credit crisis by its strict capital controls and low exposure to toxic U.S. mortgage-backed assets they acknowledged that its financial system could not entirely escape the impact.