Nov. 2 (Bloomberg) -- China's stocks fell for a second day on concern higher fuel prices will increase costs for companies and discourage spending, hampering the nation's economic growth. China Southern Airlines Co. led the declines.

Aluminum Corp. of China Ltd., the nation's biggest producer of the lightweight metal, fell to a 10-week low on speculation rising electricity prices will reduce profits.

``The market keeps falling on concern higher oil prices will slow economic growth and corporate profits,'' said Wang Zheng, who manages the equivalent of $500 million at Everbright Securities Co.'s asset management unit in Shanghai.

Baoshan Iron & Steel Co. fell for a fourth day on expectations higher iron-ore costs will erode margins. Jiangxi Copper Co. slumped as the metal's price declined in Shanghai.

Citic Securities Co. jumped by the 10 percent daily limit to a record on its first day of trading in Shanghai since announcing a $1 billion cross-investment with Bear Stearns Cos.

The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, fell 132.30, or 2.4 percent, to 5,472.93 at the 3 p.m. close, paring this week's gain to 1.4 percent.

China Southern Airlines Co., the nation's biggest carrier, dropped 1.15 yuan, or 5.3 percent, to 20.46, adding to yesterday's 5.6 percent decline. Air China Ltd., the world's biggest airline by market value, slid 1.34 yuan, or 6.4 percent, to 19.68, extending yesterday's 4.7 percent slump.

China unexpectedly increased fuel prices by as much as 10 percent effective yesterday in what the government said was an ``urgent step'' to help the nation's oil refiners cover rising costs as crude touched records. The country is the world's second-biggest energy consumer.

Power Disruptions

The government faces pressure maintaining power supplies in some regions, the National Development and Reform Commission, the nation's top planning agency, said in a statement in Beijing today. Accelerating raw-material costs are boosting inflation pressures, it said.

Crude oil headed for a fourth weekly gain because of concern consumption will outpace supply and as a weaker U.S. dollar spurred demand for commodities. Crude oil for December delivery gained as much as 66 cents, or 0.7 percent, to $94.15 a barrel in after-hours trading in New York.

Aluminum Corp. of China fell 1.48 yuan, or 3.1 percent, to 46.58. Electricity will account for 40 percent of costs for Chinese smelters, up from a third after the government cancels discounts by the end of the year, Joshua Chen, chief financial officer of the company that's known as Chalco, said yesterday.

Curb Growth

Yunnan Aluminium Co., China's fourth-largest producer of the metal, slipped 1.80 yuan, or 6 percent, to 28.12.

The Chinese government will cancel electricity price discounts for the aluminum industry to curb growth in power- intensive industries, the National Development and Reform Commission said Oct. 11.

Baoshan Steel, China's biggest steelmaker, dropped 1.02 yuan, or 5.7 percent to 16.84, the lowest since Aug. 23. Angang Steel Co., China's third-largest steelmaker by output, slumped 1.93 yuan, or 6.6 percent to 27.19, adding to a 10.7 percent two-day drop.

The price of iron ore is expected to rise 50 percent next year, a sixth year of price gains, Macquarie Bank Ltd. said last month. Iron ore is the raw material used to make steel.

Jiangxi Copper Co., China's second-largest producer of the metal fell 3.59 yuan, or 5.6 percent, to 60.96. Yunnan Copper Industry Co., China's third-biggest producer of the metal, fell 4.74 yuan, or 6.4 percent, to 69.46.

Copper declined in Shanghai for a second day, heading to its lowest in more than two months, as global inventories rose to their highest since April, raising concerns demand may be slowing for the industrial metal.

Citic Securities, Asia's largest brokerage by market value, whose shares were suspended since Oct. 22, climbed 10.59 yuan, or by the daily limit, to a record 116.52 yuan. During the trading halt, Citic Securities also reported a more than eightfold increase in third-quarter profit.

To contact the reporter on this story: Jiang Jianguo in Shanghai at jjiang@bloomberg.net.

Last Updated: November 2, 2007 03:43 EDT