Shandong Aluminium Industry fell after it offered lower compensation than other companies in its plan to reform its share structure.

"The decline in shares of Shandong Aluminium is a reflection of the market's dissatisfaction with its compensation plan," said Sun Chao, a market analyst with CITIC Securities in Shanghai. "It's lower than the average offer."

Signals that the government may increase the amount insurance companies can invest in stocks limited the decline.

ADVERTISEMENT

The Shanghai Composite Index, which tracks yuan-denominated A shares and foreign-currency B shares, slid 2.79, or 0.2 percent, to 1,732.45 at the close.

The Shenzhen Composite Index, which tracks the smaller market, added 1.63, or 0.4 percent, to 431.39.

Shandong Aluminium Industry, a listed affiliate of Aluminum Corp of China, fell 3.4 percent to 16.37 yuan (HK$16.06). The company Monday announced a revised plan for the flotation of its nontradable shares, offering 2.5 free shares for every 10 tradable shares held. It originally offered two shares.

China started a program in May last year to convert more than US$300 billion (HK$2.34 trillion) of nontradable shares in listed companies into common stock that can be bought and sold on the stock exchange.

Jiangxi Copper, the country's largest producer of the metal, dropped 1.4 percent, to 10.24 yuan. Copper for November delivery on the Shanghai exchange fell 2,240 yuan, or 3.2 percent, to 68,730 yuan a tonne at the close.

China Vanke, the country's largest listed developer, led a rally in property shares. China Vanke added 0.34 yuan, or 4.7 percent, to 7.57 yuan.

Gemdale, a developer in Shenzhen, rallied 0.41 yuan, or 4.3 percent, to 9.91 yuan.

Airline stocks climbed as the price of crude oil traded near a six-month low on speculation the carriers' fuel costs will drop. China Eastern Airlines, the country's third-biggest carrier, rose 0.02 yuan, or 0.7 percent, to 2.88 yuan.

China Eastern said in a statement after the market closed Tuesday that it flew 3.27 million passengers last month, 22 percent more than a year earlier. In the first eight months of the year, passenger numbers rose 63 percent to 23.3 million, the company said.

Economic growth in China is making air travel affordable to more people.

Elsewhere, Laiwu Steel declined 0.07 yuan, or 1.1 percent, to 6.13 yuan.

The company said China's government has not rejected Arcelor's plan to buy a 38.41 percent stake in the Shandong province-based company and is still reviewing the proposal.

The company was responding to a report by the Economic Observer last Saturday, which said the government rejected Arcelor's plan to buy Laiwu Steel in August.

BLOOMBERG