Stocks tumble to 13-month low as concerns grip markets

A man checks stock prices at a brokerage in Hangzhou, Zhejiang province, Jan 26, 2016. [Photo/IC]

Chinese stocks are back to their original point over a year ago, as market concerns have sent the benchmark Shanghai gauge below the 2,800 level.

The Shanghai Composite Index sank 6.4 percent to 2,749.79, marking its lowest close since December 2014, while the Shenzhen Component Index slumped 7 percent to close at 9,483.55.

Nearly a thousand stocks at the two markets tumbled by the daily limit of 10 percent on Tuesday, as the plunge swept across financial firms to mining and electronic sectors.

The recent fraud in acceptance bills and capital outflow have sparked market concerns, said Guojin Securities in a note, adding that liquidity strain often appear before Chinese New Year holiday.

Two employees of the Beijing branch of Agricultural Bank of China were reported on Friday to be under investigation for allegedly taking 3.9 billion yuan ($592.8 million) of bank's acceptance bills out of the branch's safe and cashing the same through repurchase transactions.

Such rule violations and discipline breaches have been rising since last year, according to a latest survey released by the China Banking Association and global accountancy firm PricewaterhouseCoopers

Foreign firms are keen to invest and enhance their earning abilities in China, said a government official on Monday, dismissing the rumor on some firms' withdrawal from the country.

The CSI Index tracking some of the largest-cap stocks in Shanghai and Shenzhen tumbled 6 percent on Tuesday to 2,940.51.