Weak PMI data drags down Chinese shares

BEIJING - A weak reading of the HSBC Flash Manufacturing Purchasing Managers' Index (PMI) that suggested contraction in the manufacturing sector in May weighed on Chinese shares on Thursday, sinking stocks indexes by more than 1 percent.

The benchmark Shanghai Composite Index lost 1.16 percent, or 26.74 points, to end at 2,275.67. The Shenzhen Component Index fell 1.48 percent, or 139.39 points, to 9,265.68.

Combined turnover on the Shanghai and Shenzhen bourses shrank to 235.35 billion yuan ($38.02 billion) from 254.73 billion yuan the previous trading day.

HSBC said Thursday that China's preliminary manufacturing PMI for May fell to 49.6 percent, dropping below the boom-bust line for the first time since October 2012. HSBC attributed the manufacturing contraction largely to weak demand both at home and abroad.

Meanwhile, the sluggish figure triggered investors' concerns over a slowdown in the Chinese economy.

Cement producers led Thursday's declines, with the sub-index for the sector down 2.57 percent. Shaanxi Qinling Cement (Group) Co Ltd fell 3.63 percent to 5.84 yuan per share.

The coal sector lost 2.51 percent. Henan Dayou Energy Co Ltd. sank 3.67 percent to 23.12 yuan per share.

The media and entertainment sector retreated 1.48 percent, and the finance sector weakened 1.88 percent.