BEIJING, June 8 -- Shanghai's stock market posted its biggest single-day loss in 52 months over investor's worries that a raft of upcoming initial public offerings (IPO) could soak up capital and drag down the prices of existing shares.

    The Shanghai Composite Index, which tracks yuan-denominated A shares and hard-currency B chips, dropped 5.33 percent to 1,589.55 after dipping 0.33 percent on Tuesday. The decline was the steepest since January 28, 2002, when the benchmark lost 6.33 percent.

    The A share index slumped 5.36 percent to 1,670.25 while the B share index slid 3.22 percent to 91.93.

    "It's a substantial correction after the recent sizzling rallies," said Liu Yu, an Orient Securities Co trader. "News about the IPOs has prompted investors to train their sights on new equity sales in the hopes of quick profits."

    Before yesterday, the Shanghai stock index had risen 44.3 percent since the start of the year as a result of strong institutional buying and investor sentiment that a bull market had finally arrived after a four-year plunge.

    Encouraged by rising share prices, regulators resumed IPOs and secondary stock sales last month after a yearlong moratorium. The hiatus allowed all Chinese mainland-listed firms to convert their state ownership into tradable common shares. Several big share issues and a host of smaller ones are now on the horizon.

    The Bank of China Ltd unveiled a plan on Tuesday to sell as many as 10 billion yuan-backed shares in Shanghai, an IPO that could raise a record 20 million yuan (US$2.5 billion). The announcement followed the bank's US$11.2 billion IPO in Hong Kong last month

    The Industrial & Commercial Bank of China, the country's biggest lender, plans to issue yuan-denominated A shares "soon" after its proposed Hong Kong IPO late this year, according to its president, Yang Kaisheng.

    Fifty-one companies have unveiled plans to raise as much as 65 billion yuan selling debut shares or conducting secondary offerings after regulators lifted the stock-sale ban, the Securities Times reported yesterday, citing its own analysis.

    "It's still too early to judge whether the upside trend is near a peak," said Beijing Shoufang Investment Consulting Co. "But investors should stay away from overbought sectors such as metals and property at least in the short term."

    Jiangxi Copper Co, China's biggest publicly traded producer of the metal, was down 5 percent to 10.63 yuan after copper prices fell 3.2 percent to US$7,510 a metric ton in London on Tuesday.

    Shares in Shandong Gold Mining Co, China's No. 2 listed gold producer, slumped to the 10 percent daily cap and closed at 29.15 yuan after gold futures dropped 2.2 percent in New York.

    Shanghai Shimao Co, owned by property tycoon Xu Rongmao, was down 4.90 percent at 5.05 yuan. China Merchants Bank Co, the nation's biggest listed lender, eased 4.86 percent to 6.85 yuan.

    They face not only competition among themselves but from cheap knockoffs made by black-market suppliers.