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China Stocks Resume Drop as State Buying Fails to Lift Sentiment

  • CSI 300 initially erases losses before ending day down 2.2%
  • Beijing wants to ensure stable markets during NPC, people said
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WATCH: Chinese state-backed funds were said to intervene on Tuesday to alleviate declines in the stock market. (Source: Bloomberg)
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The bearish mood prevailing in China’s stock market is proving a match even for state-backed funds, and casting a cloud over the Communist Party’s biggest annual political event.

The CSI 300 Index closed about 2.2% lower despite evidence that state-backed funds had intervened to shore up the market in morning trading. The news earlier helped the gauge erase losses of as much as 3.2%, before declines resumed in the afternoon. Kweichow Moutai Co., the stock that’s become an indicator of sentiment in China’s mutual fund industry, fell 1.2%.