BEIJING, March 5 (Xinhua)-- Chinese shares opened lower on Wednesday morning and dive more than 2 percent in the morning session than the previous trading day.

    The benchmark Shanghai Composite Index drop 92.82 points, or 2.14 percent, to close at 4,242.63 points in the morning session. Traded between the highest 4,352.82 points and the lowest 4,241.60 points, with a turnover of 57.31 billion yuan (8.2 billion U. S. dollars).

    Analysts said investor confidence has remained vulnerable to uncertainties overhanging the market, including further monetary tightening measures to combat inflation and more new refinancing plans by public listed companies.

    Chinese Premier Wen Jiabao said in his government work report on Wednesday that China needs to follow a prudent fiscal policy and a tight monetary policy this year to accomplish the tasks for macroeconomic regulation.

    The Shenzhen Component Index ended down 507.89 points, or 3.23 percent, to 15,238.34 points, and the total turnover was 30.57 billion yuan.

    The Hushen 300 Index, which accounts for 60 percent of the market value in China's stock market and reflects the performance of China's Shanghai and Shenzhen stock exchanges closed at 4,559.897 points, down 2.38 percent.

    Sharp falls in banking and blue-chip financial stocks led the price drop in the morning session.

    Price of Sinopec--China Petroleum and Chemical Corporation-- tumbled 4.82 percent to 16 yuan.

    Industrial and Commercial Bank of China lost 1.26 percent to close at 6.28 yuan, while the Bank of China slipped 1.27 percent to 5.45 yuan in the morning session.

Chinese Premier pledges hefty investment schemes under tight monetary policy

    BEIJING, March 5 (Xinhua) -- China is to follow a tight monetary policy to address the still-unsolved problem of excessive liquidity, and the government pledges to add another several hundred billion yuan in additional funds to boost agriculture, education, medicare and strengthen the nation's social safety network.

    Addressing the First Session of the 11th National People's Congress, Premier Wen Jiabao said in his government work report that the decision to follow a tight monetary policy is based on "the strong possibility of a resurgence in fixed asset investment, continued excessive supplies of money and credit, the still-unsolved problem of excess liquidity, and considerable inflationary pressure."  Full story