China stocks fell to a near one-month closing low on Monday as investor sentiment was hit by regulators' crackdown on speculation as well as a fresh wave of initial public offerings (IPOs).
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The blue-chip CSI300 index fell 0.8 percent to 3,176.81 points, while the Shanghai Composite Index lost 0.9 percent to 2,953.39.
Shenzhen's start-up board ChiNext dropped for its fourth straight session to a 1-1/2-month low, although the index later recovered some of its sharp losses.
"We have seen an escalation in regulatory oversight," said Wu Kan, head of equity trading at investment firm Shanshan Finance.
"It's good for the market in the long term, but it hurts sentiment in the short term."
China's securities watchdog has recently tightened rules over hedge funds, limited shadow banking business of mutual fund houses and is drafting rules aimed at curbing money flows from banks into the stock market through wealth management products.
In addition, the stock exchanges have stepped up a crackdown on speculative trading.
Traders also attributed Monday's market weakness to a flood of nine IPOs this week, including relatively big share sales by Jiangsu Jiangyin Rural Commercial Bank Co Ltd and Bank of Guiyang Co.
But the market drew some support from a private business survey showing on Monday that China's manufacturing activity expanded for the first time in 17 months in July, though the pace of growth was modest.
Bucking the trend, most gold stocks rose.
(Reporting by Samuel Shen and Pete Sweeney; Editing by Kim Coghill)