1st LD-Writethru: China stocks close lower on Thursday

Chinese shares closed lower on Thursday as heavyweight shares experienced a weak performance.

The benchmark Shanghai Composite Index was down 1.39 percent to end at 3,197.89 points.

The Shenzhen Component Index dropped 1.84 percent to close at 10,424.65 points. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, lost 1.57 percent to close at 2,039.12 points.

Total turnover on the two bourses was 610.7 billion yuan (95.65 billion U.S. dollars), down from 844.9 billion yuan the previous trading day.

Losers outnumbered winners 753 to 159 in Shanghai, and by 1,106 to 267 in Shenzhen. Stocks in brokerage and oil sectors led the decline.

China's producer price index, a measure of costs for goods at the factory gate, fell 5.9 percent year on year in August, widening from the 5.4-percent drop seen a month earlier, pointing to looming deflation risk, official data showed Thursday.

The August reading dipped to its lowest level since the end of 2009 and marked the 42nd-straight month of decline.

At Summer Davos in northeast China's Dalian city on Wednesday, Premier Li Keqiang said measures have been taken to prevent the spread of financial risk and stabilize the stock market during unusual fluctuations in June and July.

The measures are normal practice in global markets and do not mean the government is trying to replace the market or weaken it, he said.

Weighed down by volatile global markets, Chinese shares have gone through major fluctuations in the past two months with the benchmark Shanghai Composite Index falling around 40 percent from its peak in June.

"The recent volatility appeared to be a follow-up to the global financial crisis that broke out in 2008," Li said. "China is not the source of it, but instead remains one of the major drivers of global growth." Endi