A SLUMP in shares of banks like China Construction Bank Corp. late Friday was a result of changes in the investment portfolios of one or two foreign institutional investors, the Shanghai Stock Exchange said.

    Some foreign index service providers adjusted the components and the weight of components of their indices for stocks trading in the Shanghai and Shenzhen stock exchanges, which led to one or two foreign investors under the so-called Qualified Foreign Institution Investor (QFII) program to accordingly adjust their positions in those stocks, the bourse said Sunday through its official account on the Weibo, a U.S. Tweeter-like microblogging service in China.

    The QFII program, set up in 2002 in China, allows select foreign investors to trade domestically-traded yuan-denominated A shares within a preset quota.

    The reallocation of positions by QFIIs resulted in an “abnormal movement” in stocks including China Construction Bank, China Citic Bank Corp., Bank of Communications and Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co. toward the end of trade Friday, the Shanghai bourse said.

    The exchange will further inspect the trading of these stocks, it added.

    A steep drop in heavyweight banking sector within the last few minutes before the stock market close Friday brought the decline in the benchmark Shanghai Composite Index to 2.02 percent that day, marking the biggest one-day percentage drop since Sept. 17, when it dropped 2.05 percent. It also sent the index to its lowest close in four months.

    On Friday, China Construction Bank closed down 6.2 percent after hitting its 10 percent downside limit, while China Citic Bank dropped 8.7 percent after touching its 10 percent daily downside limit. Meanwhile, Bank of Communications slid 4.5 percent. (SD-Agencies)