Stock markets tumble as IPOs attract funds

Stock markets in the Chinese mainland ended the lower last week, despite some gains on Friday, as a string of companies went public throughout the week.

The benchmark Shanghai Composite Index edged up 2.94 points or 0.15 percent to 2,026.67 points on Friday, the lowest in a month. The index ended the week with a loss of 2.8 percent from the previous Friday, June 13.

The Shenzhen Component Index rose by 0.21 percent or 15.37 points to 7,195.69 points on Friday, with a weekly loss of 3 percent.

The combined turnover on the two bourses on Friday was 127.03 billion yuan ($20.4 billion), down from Thursday's 176.5 billion yuan.

Friday's slight gain, driven by the plastic products manufacturing and crude oil industries, came after Chinese Premier Li Keqiang said in London during a three-day visit that the country's economy will not experience hard landing.

Although Li expressed his confidence on China's economy, the stock markets plummeted as listings by four mainland companies created huge capital demand.

The four companies, with business in fields ranging from auto parts to environmental technology, raised a total of 1.8 billion yuan, according to the statements the firms filed to the Shanghai and Shenzhen bourses.

The China Securities Regulatory Commission plans to allow 100 companies to go public during the rest of 2014, bringing the full-year tally up to 150, Reuters reported on Friday. That will further drive the stock market down, experts said.

Lock-up shares of 20 companies worth 17.2 billion yuan will become tradable this week, according to the Shanghai and Shenzhen exchanges.

Bucking the overall trend, three stocks, including the real estate investor Zhejiang Guangsha Co Ltd and Shaanxi Qinling Cement Co, jumped by the daily limit of 10 percent on Friday.

ChiNext, China's NASDAQ-style board for high-tech and fast-growing start-ups listed in Shenzhen, grew by 1.01 percent or 13.33 points to 1,333.98 points on Friday. The index fell by 4.4 percent last week.