China shares end down 0.5 pct

China8217;s key stock index closed down 0.5 per cent in lower volume on Wednesday,with profit taking in railway stocks which had enjoyed a rally on government spending plans countering gains in coal miners and consumer firms.

Fears about the availability of cash in the stock market hampered gains for the second consecutive day. China8217;s benchmark short-term money market rate,the main barometer of short-term liquidity supply,jumped to a 2-year high as banks prepared funds to meet a hike in reserve requirements.

The Shanghai Composite Index was at 2,911.4 points,trading above the 250-day moving average,now at 2,862 points. Analysts are optimistic about the outlook for the market,citing that level as providing firm support due to strong corporate earnings and reasonable valuations.