In Europe finance ministers said Greece had made “considerable progress” on meeting conditions for its next tranche of rescue cash, but they would have to meet again on Tuesday next week to decide whether to release it.

Investors are also growing increasingly nervous about the approaching automatic spending cuts and tax rises that threaten to send the US economy back into recession unless a cross-party deal is brokered.

“China’s economy is on a recovery (track), though not a V-shape rebound,” Steven Leung, director of institutional sales at UOB KayHian, told Dow Jones Newswires, saying he saw value emerging in policy-driven and cyclical stocks.

Out of 49 Hong Kong blue chips, 45 finished in the red – with property giant New World Development, major Chinese oil firm Sinopec and coal miners Shenhua and China Coal registering losses of over 2.0 per cent.

Chinese shares closed down 1.51 per cent. The benchmark Shanghai Composite Index fell 31.39 points to 2,047.89 on turnover of 44.6 billion yuan (HK$55 billion). The index ended at its lowest level since September 26.

“Positive October economic indicators helped ease concerns over the domestic economic outlook, but remained insufficient to move the market further north,” Shenyin Wanguo Securities analyst Li Xiaoxuan told Dow Jones.

Investors were also awaiting the end this week of the Communist Party’s 18th Congress that will choose the country’s leaders for the next 10 years.

Developers fell after state media quoted a housing official as saying Monday that the government had no immediate plans to loosen property control measures, which have been in place for more than two years.

China Vanke ended down 2.2 per cent at 8.37 yuan while Gemdale lost 3.9 per cent to 5.25 yuan.

Securities firms also fell on earnings fears. Sinolink Securities fell 6.5 per cent to 14.21 yuan, Haitong Securities lost 3.4 per cent to 8.44 yuan and Citic Securities slid 1.6 per cent to 10.69 yuan.