China stocks slump on lackluster economic indicators

Chinese shares tumbled on Monday morning after economic data released over the weekend showed a sharp drop in exports in February. The benchmark Shanghai Composite Index fell 1.69 percent to finish at 2,023.22, while the Shenzhen Component Index declined 1.45 percent to close at 7,222.02. Companies related to ship and aircraft manufacturing, furniture and development zones led the decline. The sub-index for ship manufacturing fell 4.54 percent. The sharp slump was mainly attributed to China's February customs data released on Saturday that showed the first trade deficit in 11 months, which contrasted with the huge surpluses last February and this January. In addition, the country's producer price index, which measures inflation at the wholesale level, contracted for 24 consecutive months in February, further compounding the gloomy outlook among investors. Although China's economic growth has shown signs of stabilizing after a slowdown in 2011, downward pressures still existed and cannot be ignored this year, analysts said. The tourism and aviation sector also suffered. The average share price of 23 listed tourism companies lost 2.19 percent by midday, and prices of eight airlines dropped 2.76 percent. The missing Malaysia flight MH370, carrying 227 passengers, remained unlocated after the loss of its radar signal at 1:20 a.m. on Saturday. Factors including the largest volume of lock-up shares becoming tradable this week and the restart of initial public offerings in March also contributed to the decline.