Shanghai stocks closed Wednesday's session to the lowest level since mid-October, after data of more than expected slower inflation in Chinese producer prices and amid continued concerns over tightening of financial regulation.
CSI300 index, which tracks the value of securities of the largest companies traded in Shanghai and Shenzhen, fell 0.5% to 3,337.70 points, down for the eighth consecutive session. The Shanghai Stock Exchange's Shanghai Composite Index lost 0.9% and closed at 3.052.79 points.
ChiNext index, reflecting the dynamics of the value of shares of high-tech companies and Internet start-ups, fell 1.7% and closed at a minimum of 27 months.
Producer price inflation in China slowed more than expected in April, signaling that production activity may be losing momentum along with other sectors of the economy, while domestic demand remains weak and the country's authorities are taking tough measures to combat financial risks.
Toughening financial regulation is of great concern to investors, many of which fear that the measures taken by the government can harm growth in the world's second largest economy.
The main sectors fell under the pressure of shares of industrial and raw materials companies. The securities of the financial sector strengthened their positions.
Shares in Hong Kong rose the third consecutive session and reached a new 21-month high by the close of today's trading, despite the fall in Shanghai stocks.
Improvement in market sentiment was promoted by the growth of many Asian sites due to good corporate reporting, as well as signs of continued cash inflow from China.
The index of Hong Kong Stock Exchange – Hang Seng rose 0.5% to 25.015.42 points. The index of Chinese companies traded in Hong Kong added 1.0%, to close at around 10,227.42 points.
The sectors showed mixed dynamics. While shares of financial and telecommunications companies rose, the commodities sector's shares lost ground.