Stock exchanges fall back amid slowdown in services

Stock markets in the Chinese mainland fell back on Wednesday, erasing most of the gains in the previous two trading sessions.

The benchmark Shanghai Composite Index nudged down by 17.95 points or 0.89 percent to 2,010.08 points on Wednesday. The Shenzhen Component Index declined by 77.19 points or 1.06 percent to 7,234.69 points.

Combined turnover on the two bourses on Wednesday was 132.94 billion yuan ($21.32 billion), down from Tuesday's 138.74 billion yuan.

Wednesday's decline coincided with the release of data showing a slowdown in the services sector. The Markit/HSBC services Purchasing Managers' Index (PMI) declined to 51.4 in April, down from 51.9 in March.

Also, the People's Bank of China, the central bank, released a statement on its website on Tuesday saying it would not loosen monetary policy, dampening market sentiment on Wednesday.

The China Securities Regulatory Commission (CSRC) began unveiling new draft IPO prospectuses on April 19, signaling a possible resumption of IPOs. The number of companies that have announced draft IPO prospectuses since then reached 273 on Wednesday.

The possible resumption of IPOs has raised concerns among investors that it could lead to funds being drained away from existing stocks.

Meanwhile, railway-related stocks bucked the downward trend on Wednesday. Gem-Year Industrial Co jumped by the daily limit of 10 percent to 8.71 yuan and Jinxi Axle Co rose by 6.15 percent to 13.46 yuan.

Railway-related stocks were boosted by comments from Chinese Premier Li Keqiang during a trip to Africa this week. Li said China would share high-speed rail technology with Africa.

ChiNext, China's NASDAQ-style board for high-tech and fast-growing start-ups listed in Shenzhen, saw a big fall on Wednesday, giving up almost all the tech-stocks-led gains of the last two trading days. The gauge declined by 26.83 points or 2.04 percent to 1,290.03 points.