Stocks edge down as industrial growth disappoints market

An investor watches an electronic board showing stock information at a brokerage office in Jiujiang, Jiangxi province, Sept 14, 2015.[Photo/IC]

Stocks slumped on Monday, as latest statistics showed the country's economy failed to grow as expected in August.

The benchmark Shanghai Composite Index closed at 3114.80, down 2.7 percent, while the Shenzhen Component Index plunged 6.6 percent to 9,778.23.

The National Bureau of Statistics said on Sunday that industrial output, the main monthly growth measure, rose to 6.1 percent year-on-year last month, up from 6 percent in July, but short of consensus expectations of 6.5 percent.

More than 1,000 stocks sank by the daily limit of 10 percent, led by technology and Internet shares. Firms such as video-streaming giant LeTV Holdings Co, DHC Software Co, and Thunisoft Software Co tumbled by 10 percent.

Banks rose against the benchmark, as China Merchants Bank surged 7.2 percent, Minsheng Bank 5.7 percent, and Huaxia Bank 2.9 percent.

The turnover reached 681.1 billion yuan at the two markets on Monday. The outstanding balance of margin trades at the Shanghai Exchange declined for a second day to 618.9 billion yuan as of Friday, data compiled by the bourse showed.

On Friday, Premier Li Keqiang sent a message to the world at the "Summer Davos" forum in Dalian, Liaoning province, that a slower growth rate is acceptable unless there is turbulence in the job market. Measures introduced to date are sufficient to prevent an economic "hard landing".

The State Council unveiled long-awaited guidelines for the State-owned enterprises (SOEs) reform over the weekend to speed up the nation's economic transition.

The reform calls for the government to introduce more market-oriented wage and human resource system, to focus on SOEs' capital returns and to practice greater tolerance with so-called mixed ownership.

"The fundamentals underpinning a stable Chinese economy have not changed," said the Premier at the forum, adding that the government is taking necessary measures of targeted, discretionary and precision macro regulation to lay the foundation for sustainable and healthy growth in the future.

The CSI 300 index closed at 3,281.13 on Monday, down 2 percent.