China blue-chip index ends weaker; banks weigh

China’s blue-chip stocks slipped on Wednesday, with gains in resources and infrastructure firms offset by weaknesses in banks, and after a survey showed manufacturing output in October rose at the weakest pace in four months.

The blue-chip CSI300 index fell 0.25 percent to 3,996.62, while the Shanghai Composite Index closed up 0.08 percent at 3,395.91 points.

Caution prevailed as a survey by Caixin showed China’s manufacturing output rose at the weakest pace in four months in October and companies continued to shed staff despite a slight pickup in domestic and export orders.

The Caixin report followed a similar official survey on Tuesday, which pointed to an unexpected cooldown in China’s manufacturing sector in the face of a weakening property market and a crackdown on smog, which is forcing some steel mills and factories in northeastern China to curtail or halt production. The report reinforced concerns about the country’s economic recovery losing steam.

The growth momentum is expected to weaken in the coming months as the drags from slower credit growth, reduced fiscal support after the key meeting as well as the environmental crackdown all intensify, according to Julian Evans-Pritchard, China economist at Capital Economics. Sector performance was mixed. The infrastructure sector rose 0.80 percent, led by China State Construction Engineering posting its best day since mid-July.

Resource stocks also firmed, helped by strength in the commodities market, with the energy subindex up 0.70 percent.

But the banking sector slid 0.60 percent, while consumer stocks also weakened following recent gains.