SHANGHAI - A new wave of unlocked shares, including those of blue-chip companies, failed to depress the domestic stock market on Monday, as investors took a sanguine view of the supply surge.

The Shanghai Composite Index fell a modest 1.7 percent to 2,206 points and had a turnover of 42.9 billion yuan ($6.8 billion).

According to the financial data provider Wind Information Co Ltd, up to 8.94 billion restricted shares of 24 companies were released for trading on the Shanghai and Shenzhen stock exchanges on Monday. The shares had a combined value of about 42.84 billion yuan, calculated on the basis of Jan 13 closing prices.

Topping the scale of newly unlocked shares was Agricultural Bank of China Ltd (ABC), which went public in July 2010.

It announced that 5.1 billion of its non-tradable A shares would be unlocked and released to the market on Monday on the Shanghai Stock Exchange, a company statement showed.

Based on the closing price of 2.65 yuan on Jan 13 - below its IPO price of 2.68 yuan - the shares had a combined value of 13.5 billion yuan.

The bank suspended trading on Monday for a shareholders' meeting, which analysts said made it harder to gauge market reaction.

For ABC, shareholders of the current tranche include 27 strategic investors, 15 of which are State-owned enterprises, such as China Life Insurance (Group) Co and China National Tobacco Corp.

Except for those held by the government, all ABC shares have been made tradable.

The statement showed that the unlocked shares represented less than 2 percent of ABC's existing share capital, after the expiry of an 18-month lock-up.

The last such release came six months ago when the same amount of A shares was unlocked.

Meanwhile 12.4 billion restricted H shares that cornerstone investors had were unlocked, but key investors such as Qatar Holding LLC and Temasek Holdings (Private) Ltd held the shares for a long time.

"Financial indicators show the bank's solid fundamentals, especially in emerging industries" and the development of business with small and medium-sized enterprises, Zhang Yidong of Industrial Securities Co Ltd wrote in a research note.

"The bank can ride the boom of county-level economic development transition in the coming years, and that is why we rated its shares 'retain'," Zhang said.

Fu Jia, an analyst from Temasek Holdings, did not see a strong chance of ABC shares being dumped after the lock-up period ended.

For instance, China Life, the biggest strategic investor, held about 1.19 billion Shanghai-traded shares when the bank went public in 2010.

But Fu pointed out the current figure had risen to 1.2 billion, indicating buying rather than selling, despite the end of the lock-up.

"Many investors maintain a long-term commercial relationship with the bank. The relatively low prices of bank shares reflect worries over rising bad loans, but the 'Big Four' banks generally do not run the risk of toxic assets," Fu said.