Equities decline on weak factory data

Domestic stocks fell for a second day after official data showed manufacturing contracted for a third month and the authorities detained a top-performing hedge-fund manager in widening probes into market manipulation and insider trading.

The Shanghai Composite Index dropped 1.7 percent to 3,325.08 points at the close, while the Hang Seng China Enterprises Index slid 1.5 percent in a fifth day of losses, the longest losing streak in almost two months. PetroChina Co and Aluminum Corp of China Ltd led declines for commodity shares, sliding at least 2.5 percent.

Police raided hedge fund Zexi Investment on Sunday, according to a source familiar with the matter. The 26 companies of which Zexi disclosed as a shareholder in the past 12 months fell by an average of 4.5 percent on Monday.