Banks including China Merchants Bank Co. fell after BNP Paribas SA cut the rating on China's financial companies.
The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, declined 90.25, or 1.9 percent, to 4,620.40 at the close, the lowest since Aug. 3. The measure dropped 13 percent this month, the second-steepest monthly slide -- after November's 17 percent fall -- since it was introduced in 2005.
The decline reduced China's market capitalization to $3.91 trillion as of yesterday, helping Japan regain the title of the biggest stock market in the Asia-Pacific region, according to data compiled by Bloomberg. The market capitalization of the Japanese market was $4.23 trillion.
Yanzhou Coal Mining Co., the listed unit of China's fourth- biggest coal miner, slumped 2.09 yuan, or 9.6 percent, to 19.61. Its Hong Kong-listed stock was downgraded to ``sell'' from ``neutral'' and had its share-price estimate cut by 40 percent at Goldman, Sachs & Co.
China is experiencing the worst blizzards in 50 years, bringing railway services to a standstill and forcing the government to mobilize the largest deployment of troops in a decade to clear ice.
Roads, railways and power supplies across much of central, southern and eastern China were paralyzed late yesterday. More than 750,000 houses have been damaged or destroyed.