China's stocks fell for a second consecutive day

China's stocks fell for a second consecutive day that the government increased control of real estate investments and concerns that may become more expensive for smaller companies to borrow money after a gauge of borrowing costs increased.

China Vanke Co. dropped more than 1.5 per cent, losses to property developers, after the Commerce Ministry has ordered local authorities to stop the passage of some foreign-owned investments to slow
speculative

purchase. Laibao Shenzhen High-tech Co., a manufacturer of conductive glass for touch screens, was an indicator of smaller companies at least two weeks. The repurchase rate seven days, which measures the cost of loans between banks, rose to its highest level since October 2007.

"Uncertainty about the controls is the decision of the market," said Deng Changrong, strategist at Huaxi Securities Co. in Shenzhen. "As the market lacks liquidity at the moment, there is no support for a strong recovery."

The Shanghai Composite Index, which remains the largest stock exchanges in China, lost 22.68, or 0.8 percent, to 2,855.22 as of 3 pm The CSI 300 Index fell 0.8 percent to 3,188.61. The CSI SmallCap 500 company with a market cap average of 7.1 billion yuan, fell 2 percent to its lowest level since 10 December.

The Shanghai Composite Index, the worst performer among the major benchmarks in Asia this year, has fallen 13 percent this year on concern that monetary tightening to curb economic growth.

An indicator of property companies in the Shanghai Composite Index fell 0.7 percent. China Vanke, the nation's largest developer, retreated 1.8 percent to 8.84 yuan.

Investment property

China is going to prevent overseas companies benefit from the purchase or sale of properties completed or under construction in the country, the Ministry of Commerce, said in a statement. The ministry will strengthen the review of building projects with foreign currency flows, according to a November 22 statement was published on its website yesterday.

Housing prices in 70 Chinese cities rose 7.7 percent in November from the previous year, even after the government raised borrowing costs for the first time in three years, suspended to purchase mortgages from a third country and pledged to introduce a property tax. Sales volume increased 15 percent.

China's benchmark rate money market rose to a maximum of three years as banks hoard cash before the New Year holiday. The interest rate for seven days increased 150 basis points to 5.67 percent, according to a published daily fixing at 11 am by the National Interbank Funding. Policy makers on December 10 ordered lenders to park more money with the central bank for the third time in five weeks to curb inflation.

SmallCap losses

Shenzhen Laibao loss rate for small businesses, falling 3.7 percent to 62.40 yuan. Greenland Yunnan Biological Technology Co. tumbled by the limit of 10 percent on the day to 34.32 yuan after the company's 43.3 million shares held by the controlling shareholder Xuekui were frozen by the department of public safety.

The city of Beijing, described as the worst traffic in the world, introduced measures such as limiting the number of new passenger vehicles in the capital to ease the congested roads.

The city will issue new license plates through a lottery and requiring that passenger vehicles are not registered in Beijing to request a permit before entering the capital, according to a statement released before a news conference in municipal government today. The restriction to passenger vehicles outside the city begins on January 1, the statement said.

SAIC Motor Corp., the largest automaker in China by market value, declined 1.6 percent to 16 yuan. Beiqi Foton Motor Co. fell 2 percent to 26.06 yuan.

National Development and Reform Commission has submitted a proposal for a quota of 7.5 trillion yuan loan for the next year the State Council, the Economic Observer said, without citing anyone.

The People's Bank of China had initially proposed a quota of 6.5 trillion yuan, the NDRC, as the national planner knows, had suggested eight trillion yuan, the report said.

Banks Gain

Industrial Bank Co. advanced 1.7 percent to 24.60 yuan. Agricultural Bank of China Ltd., the country's third largest by assets, rose 0.4 percent to 2.63 yuan.

Aluminum Corp. of China led gains for metal producers, rising 1.7 percent to 10.59 yuan. Yunnan Aluminum Co. rose 4.6 percent to 12.35 yuan.

Aluminum for delivery in three months on the London Metal Exchange rose 1.1 percent yesterday to its highest since Nov. 9.