According to announcements released by the three banks on September 23, Huijin has purchased 2 million new shares of each bank on the Shanghai Stock Exchange.

China Construction Bank Corp. said Huijin now owns 65.4 percent of its shares. Huijin also holds a 35.3-percent stake in the Industrial and Commercial Bank of China Ltd. and a 67.5-percent stake in the Bank of China Ltd.

This was one of several moves by the government to stabilize the sliding stock market, including the recent cancellation of the stamp tax on stock purchases.

Moreover, listed companies have started to repurchase shares on the mainland markets, after their prices dropped. For instance, China National Petroleum Corp. said on September 22 that it had purchased 60 million A-shares of its Shanghai-listed subsidiary, PetroChina Co. Ltd.

To stabilize the mainland stock markets, Li Rongrong, Minister of the State-owned Assets Supervision and Administration Commission (SASAC), said that state-owned companies should become a positive force in driving the healthy development of capital markets and that SASAC encourages listed companies to repurchase their shares in the open markets.

Steel Price Going Down

Baosteel Group Corp. Ltd., China's largest steel mill and a gauge of the country's steel industry, said it would cut prices on some products such as steel billets and rolled steel by as much as 800 yuan ($117) per ton in November.

It was the second time that the steelmaker cut prices after a similar price reduction in October forward contracts. The two consistent price cuts marked an end to the trend of rising steel prices during the first half of the year.

Now, the fallout from the U.S. subprime mortgage crisis and global economic downturn has led to shrinking demand for iron and steel. Producers have been cutting their output to maintain product prices, and other steel mills are expected to follow suit.

Xu Lejiang, Chairman of Baosteel, told the Beijing Times that the steel industry is facing risks such as high inflation, increasing costs and lack of demand. He said China's steel industry has entered an era of high cost, and the price war tactic has hit a dead end.

"The Chinese steel industry must speed up mergers and acquisitions and upgrade industrial structures to cope with international economic fluctuations and a possible recession," Xu was quoted as saying.

Industry analysts say they expect to see mainland iron and steel prices drop and inventories pile up as a result of Baosteel's November price cuts.

Sinosteel Goes Australian

Chinese iron ore traders are increasingly searching for merger and acquisition opportunities in other countries to boost domestic supplies.

Sinosteel Corp., China's second-biggest iron ore trading company, has received approval from the Australian Government to buy a 49.9-percent stake in the Australian miner Murchison Metals Ltd.

The Chinese company had previously sought approval to acquire up to 100 percent of Perth-based Murchison, but later withdrew the application, Australia's Treasurer Wayne Swan told Bloomberg News.

"In approving Sinosteel's application, I have determined that a shareholding of up to 49.9 percent in Murchison will maintain diversity of ownership within the mid-west region," Swan said in a statement.

Analysts say the move is another step by Sinosteel to enhance its holdings in Australian companies, following its recent successful takeover of Midwest Corp., an iron ore producer also based in Perth.

In the past few years, the foreign producers had been calling the shots in deciding iron ore prices, which surged 65 percent this year. Mainland companies were urged to buy stakes in foreign producers to profit from the price increases.

Serving the World

China Oilfield Services Ltd. (COSL), China's largest offshore oil services provider, has completed its acquisition of Norway's Awilco Offshore ASA (AWO) for 17.1 billion yuan ($2.51 billion), COSL announced on September 23.

COSL is the listed arm of the China National Offshore Oil Corp. (CNOOC Group), the country's biggest offshore oil producer.

After the acquisition, AWO will be merged into COSL Norwegian AS, a wholly owned subsidiary of COSL in Norway.

Analysts say the acquisition will accelerate COSL's global expansion. Based in Oslo, Norway, AWO operates in Australia, Viet Nam, Saudi Arabia and the Mediterranean. The deal would help raise the number of COSL's operating rigs to 22 from its current 15 and create the world's eighth largest rig fleet.

Lucrative Construction Industry

The construction industry has become the fourth major contributor to the mainland's economic growth in 2007, accounting for 5.7 percent of its gross domestic product (GDP), according to the China Construction Industry Association (CCIA).

CCIA figures issued on September 23 show the construction industry's total output was valued at 5 trillion yuan ($731 billion) in 2007, with value-added products standing at 1.4 trillion yuan ($205 billion).

The CCIA report said scientific and technological innovations were two major drivers of the industry's development and provided technology support for related companies.

In 2007, Chinese construction companies were present in more than 180 countries, and 51 of the companies appeared on a ranking of the top 225 international contractors.