Editorial Summary

The Shanghai Composite Index fell 5.14 percent to close at 4,914.4 on Monday, while the Shenzhen Composite Index slumped 4.62 percent to close at 1,448.2. Trading volume on the Shanghai and Shenzhen Stock Exchanges reached RMB130.3 billion and RMB69.5 billion, respectively.

Insurance stocks led the decline on the Shanghai Stock Exchange on Monday. Shares of Ping An Insurance (601318.SH; 2318.HK) fell 10 percent to close at RMB88.39 after the company announced plans for a new A-shares and bond issue. Ping An plans to issue up to 1.2 billion new A-shares and no more than RMB41.2 billion in six-year convertible bonds to raise a total of approximately RMB160 billion, reports Shanghai Securities Journal. The deal will likely be the largest capital raising to date on the A-shares market. According to the report, Ping An plans to price the new shares at no less than the 20-day average trading price of the company's A-shares or the average trading price the day before the issuance. The company plans to use the funding as capital and for acquisitions, said the report.

Influenced by Ping An's tumble, shares of China Pacific Insurance (601601.SH) and China Life Insurance (China Life) (601628.SH; 2628.HK; NYSE: LFC) fell 8.82 percent and 8.76 percent, respectively, in Shanghai.