Investors fled the Shanghai and Shenzhen markets in droves yesterday, after the watchdog China Securities Regulatory Commission (CSRC) barred mainlanders from opening new accounts to trade in shares that are reserved for foreigners. B shares - originally meant for foreigners but actively traded by mainland investors with access to hard currency - plummeted when the two exchanges opened. By yesterday's close, they had fallen to their lowest in about three weeks. The Shenzhen B-Share Index, with constituent shares denominated in Hong Kong dollars, nosedived 9.8 per cent to 77.01 points, its lowest since June 10. All counters closed lower, with 19 million shares, worth HK$45 million, changing hands. The Shanghai B-Share Index fell 3.85 per cent to 49.55 points, on volume of 10 million shares, worth US$3.7 million. Analysts said Shenzhen was hit harder because the CSRC order on Saturday was intended to quell feverish trading in B shares by mainlanders on that exchange. Since the middle of last month, thousands of mainlanders have poured hard currency into B shares, after Shenzhen brokerages disregarded official policy by letting mainlanders open B-share accounts. Shanghai brokerages, which were eager for a piece of the action, followed suit. The move triggered a rally of B shares. Prices rose to a record high of 101.46 points on June 18, before rumours of a crackdown on B-share trading by mainlanders last week brought demand and the surge in prices to a halt. The CSRC in its ban reiterated the directive that only foreigners inside and outside China and mainlanders living overseas could open B-share accounts. The commission did not say domestic investors who have already opened B-share accounts should close them, suggesting they could continue to trade in B shares. A-share prices also dipped, as expectations of another interest rate cut did not materialise yesterday.