China shares fall after week-long rally

Chinese shares retreated Wednesday on profit-taking after a weeklong rally, led by declines for financials and nonferrous metal stocks.

The benchmark Shanghai Composite Index closed down 46.86 points, or 2 percent, at 2291.55, ending a rally that saw it rise 9.8 percent over seven sessions. The Shenzhen Composite Index for China's smaller second exchange shed 2.2 percent to 757.07.

"The confidence of investors started to fade after such a long rally, but this is just a technical reverse. With a lower dollar and higher oil prices, expectations of global inflation are still there," said Cao Xuefeng, an analyst for Huaxi Securities in the western city of Chengdu.

Bank of China, the country's third-largest commercial lender by assets, fell 2.3 percent to 3.39 yuan after the bank said its 2008 profits grew 14.4 percent, the slowest pace in three years. Industrial & Commercial Bank of China Ltd., China's biggest commercial lender, dropped 1.6 percent to 3.77 yuan, while China Construction Bank, Ltd. lost 1.9 percent to 4.20 yuan.

Nonferrous metals dipped after soaring in previous sessions, with Aluminum Corp. of China off 2.6 percent to 10.41 yuan, and Jiangxi Copper Ltd. down 1 percent to 22.3 yuan.

Auto shares fell after government raised gasoline and diesel prices Wednesday. Dongfeng Automobile Co. declined by 3.5 percent to 4.09 yuan and SAIC Motor Corporation Ltd. gave up 4.3 percent to 9.61 yuan.

In currency trading, the yuan was unchanged against the U.S. dollar at 6.83120.