The maximum weekly falling index over 11 months

Shares of Chinese companies declined last week, while the main stock index Shanghai Composite showed its maximum weekly decline in 11 months after the publication of the report, according to which the profit growth slowed China's largest corporations, as well as expectations that the inflation rate will grow by the end of the month.

Shares of China First Heavy Industries Co., Manufacturer of equipment for the mining industry and the electricity sector, fell to a record low. Shares of Shanghai Friendship Group Inc. were among retailers fall among the papers on the expectations of significant growth in production costs, which may adversely affect consumer demand.

Shares of FAW Car Co., Producing cars in China with Volkswagen AG, lost 1.8% in price after the release of statistics, according to which the expected 10% drop in car sales in China in 2011.

Investors do not believe that the period of monetary tightening is over, fear the recession began in corporate profits companies and the economy as a whole, in part because of inflation. The markets are trying to find its bottom.

Shanghai Composite Index, which is calculated based on the dynamics of the largest Chinese companies has been falling for seven consecutive trading sessions, ending Friday's trade falling by 1% to close at 2709.95 points. The index has lost 5.2% this week, which is the strongest drop since July 2, 2010. CSI 300 Index lost 0.5%, to close at 2,963.31 points, while the CSI Smallcap 500 Index lost 3.2%.

Shanghai's benchmark lost more than 3.5% since the beginning of 2011 against the background of how the Central Bank raised the bank reserve rate is already 11 times and raised interest rates four times since the start of 2010 to cool inflation. Shanghai Composite Index has dropped by 11% from year high reached on April 18.

Inflation rate-consumer price index-can be achieved in May, 5.5% in annualized reports National Business Daily, citing Huachuang Securities Co. Inflation reached 5.3% in April, the biggest gain since 2008.

Brokerage houses have raised expectations for inflation in May from 5.4% previously expected, as the prices of vegetables in southern China are rising sharply due to the drought, according to the Shanghai media. Vegetables account for about 20% in the cost of food.

Profits of Chinese industrial companies rose by 29.7% in the first four months of 2011 to 1.49 trillion yuan ($230 billion) over the same period last year, according to the National Bureau of Statistics. And this is compared with a growth of 32% in the first quarter of this year.

China First Heavy shares fell 3% to reach 4.91 yuan, the lowest price since the start of trading in shares in February last year.