China shares end down 1.2 percent, small caps drag

SHANGHAI: China's main stock index closed down 1.2 percent on Monday, dragged lower by small-caps after more data suggested that a slowdown in China's economy is spreading.

A survey on Monday showed the Chinese services sector grew in November at its slowest in three months, after data last week showed that the manufacturing sector shrank last month in the face of weakening demand both at home and abroad.

The benchmark Shanghai Composite Index finished at 2,333.2 points, after a 0.8 percent drop last week.

The drop in small caps outweighted strength in financial shares, which were supported by a cut in banks' reserve requirement ratio announced that came into effect on Monday.