Sector Snap: Chinese ETFs Follow China Shares Down

NEW YORK (AP) — Shares of Chinese exchange-traded funds fell Monday following a big sell-off in the country's benchmark index.

Exchange-traded funds, or ETFs, are securities that track an index or a basket of assets, like an index fund, but are traded like a stock.

In China, the benchmark Shanghai Composite Index on Monday dropped 192.94 points, or 6.7 percent. to 2,667.75, its lowest close in more than three months. The Shenzhen Composite Index of China's second, smaller exchange tumbled 7.2 percent to 904.14.

Investors are wary of a tightening in bank lending, which helped propel Chinese shares more than 80 percent higher earlier in August. State media reports said bank lending dropped in August from July.

The Chinese government also said last week that it will try to cut overcapacity and excessive investment in some sectors.

The iShares FTSE/Xinhua China 25 Index, which includes 25 of the largest Chinese companies, including Bank of China Ltd., oil giant CNOOC Ltd. and China Mobile Ltd., the world's largest wireless carrier by subscribers, dropped 79 cents, or 2 percent, to $39.02 in afternoon trading.