The Mainland China equity market closed down for fifth straight session on Friday, 09 November 2018, with investors becoming cautious as the Federal Reserve looked set to deliver another interest rate hike next month. Majority of SSE sectors declined, with financials stocks being notable losers after the banking and insurance regulator pushed for credit support to private companies. At closing bell, the benchmark Shanghai Composite Index fell 1.4%, or 36.76 points, to 2,598.87, meanwhile the Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 0.43%, or 5.79 points, to 1,328.19. The blue-chip CSI300 index sank 1.41%, or 45.33 points, to 3,167.44.

Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, said on Thursday that banks must allocate at least a third of their new loans to private companies, and they should not simply withdraw loans from companies facing difficulties in repayment. The market is worried that banks' non-performing loan ratios will go up if they need to lend more to businesses that are facing difficulties.

Investors have been worried that the launch of a new board for tech companies this week, announced by Chinese President Xi Jinping on Monday, will disrupt the valuation structure of the market. These concerns mounted after Fang Xinghai, deputy head of the securities regulator, had said on Wednesday the regulator would quickly implement Xi's plan for a new board.

CURRENCY NEWS: China's yuan depreciated against the U.S. dollar on Friday, inline with soft mid-point fixing by central bank. Prior to market open, the People's Bank of China set the midpoint rate at 6.9329 per US dollar vs the previous day's fix of 6.9163.

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