A-shares end morning sharply lower on recession fears;resources hit UPDATE

China A-shares finished the morning broadly lower in line with slumping regional markets, with resource stocks hit hard on concerns that a global recession will slash demand for raw materials, dealers said.

Steel makers came under pressure after the government warned of a further slide in steel prices, while property developers and financials remaining on the defensive.

The benchmark Shanghai Composite Index ended the morning down 79.06 points or 3.81 pct at 1,995.52. The index touched a low of 1,963.18 earlier in the session.

The index was still above the level it finished at on Sept 18 -- when it hit a 22-month closing low of 1,895.84 points -- before a series of government support measures pushed share prices higher.

Angang Steel (SZA 000898; HK 0347) shed 7.46 pct to 6.57 yuan, Maanshan Iron & Steel (SHA 600808; HK 0323) lost 5.56 pct to 3.57 yuan and Baoshan Iron & Steel (SHA 600019) fell 3.65 pct to 5.80 yuan after China's Ministry of Commerce said that prices of iron ore and steel products have more room to fall despite recent retreats.

China Shenhua Energy (SHA 601088;HK 1088), the country's largest coal producer, declined 5.09 pct to 20.34 yuan and China Coal Energy (HK 1898; SHA 601898) plunged 8.42 pct to 8.16 yuan. Aluminum Corp of China (Chalco) (SHA 601600; HK 2600) dropped 8.11 pct to 7.36 yuan.

China Petroleum & Chemical Corp (Sinopec) (SHA 600028; HK 0386; NYSE SNP) fell 2.45 pct to 9.94 yuan as 4.34 bln of its A-shares became tradable today as they emerged from a lockup period.

PetroChina (SHA 601857; HK 0857), the biggest index component, was down 1.40 pct at 11.97 yuan.

Among financial stocks, China Life Insurance (SHA 601628; HK 2628) slumped 5.97 pct to 19.39 yuan, Bank of China (SHA 601988; HK 3988) fell 5.12 pct to 3.15 yuan and Industrial and Commercial Bank of China (ICBC) (SHA 601398; HK 1398) was down 1.23 pct at 4.01 yuan.

The Shanghai A-share Index was down 82.81 points or 3.80 pct at 2,095.98, while the Shenzhen A-share Index fell 31.02 points or 5.25 pct to 560.10.

The FTSE/Xinhua China A 50 Index was down 317.46 points or 4.40 pct at 6,892.15 and the FTSE/Xinhua China A 200 Index fell 251.16 points or 4.51 pct to 5,314.48.

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