1st Ld-Writethru: Chinese shares close lower Friday

Chinese stocks closed lower Friday, with the benchmark Shanghai Composite Index down 0.35 percent, at 3,154.32 points.

The smaller Shenzhen index closed 0.79 percent lower at 10,289.36 points.

The ChiNext Index, China's NASDAQ-style board of growth enterprises, lost 0.95 percent to close at 1,965.03 points.

Turnover on the two exchanges stood at 454.7 billion yuan (about 66.19billion U.S. dollars).

Sectors were mixed. Gains were led by energy and environmental protection shares, while securities, insurance and health care took a breather.

State-owned enterprise (SOE) reform was the main driver behind the rally of some heavyweight blue-chips, as the nation has vowed to push forward mixed-ownership reform in several key sectors, including in the railway and military sectors.

Sinopec, the country's largest oil refiner, gained 2.09 percent to 5.87 yuan. Cec Environmental Protection Co. Ltd. rose by the daily limit of 10 percent to 11.07 yuan.

Attention was squarely on the Chinese currency, which started the new year with a big jump, surprising the market with its strong performance.

The central parity rate of the yuan continued to strengthen against the U.S. dollar on Friday by a hefty 639 basis points to reach 6.8868, the highest within a month, according to the China Foreign Exchange Trade System. Endi