China Stocks Lower after Government Cuts Growth Target

China’s stocks fell, led by financial and industrial shares, after the government set the lowest economic growth target in more than 15 years and concern grew that new share offerings will divert funds from existing equities.

China Railway Construction Corp. and China Eastern Airlines Corp. dropped more than 2 percent to pace declines for industrial companies. Bank of China Ltd. and China Life Insurance Co. both slid 1.8 percent. PetroChina Co. dropped for a fourth day. Drugmakers surged for a second day, with Jiangsu Hengrui Medicine Co. jumping 2.7 percent.

The Shanghai Composite Index slid 0.6 percent to 3,259.27 at 9:45 a.m. Premier Li Keqiang set a 2015 expansion goal of about 7 percent, down from last year’s target of about 7.5 percent, according to a work report he will deliver to the annual meeting of the legislature in Beijing. The gauge has risen 42 percent in the past six months and trades at 12.3 times estimated profit for the next 12 months, compared with the five-year average of 10.3, according to data compiled by Bloomberg.

Bloomberg

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