Stocks on the Chinese mainland fell, dragging the benchmark index down by the largest amount in six weeks on concerns that Europe's debt crisis may further slow Chinese export growth.

China Cosco Holdings Co and Cosco Shipping Co dropped more than 4 percent before a report on Thursday that may show Chinese export growth decelerated. SAIC Motor Corp slid 2.9 percent after the Xinhua News Agency said China will ban executives at State-owned companies from excessive spending on items such as cars. Sany Heavy Industry Co paced declines for construction machinery stocks after Nomura Securities Co said sales of excavators last month were "disappointing".

The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, slumped 40.3 points, or 1.7 percent, to 2,408.59 at the close, the biggest drop since March 28. The CSI 300 Index declined 1.9 percent to 2,657.51.

"If the Greece and euro woes continue, it will start to drag on the market as investors will be concerned about the effect on the economy," said Larry Wan, Beijing-based head of investment at Union Life Asset Management Co, which manages the equivalent of $2.2 billion.

Even with Wednesday's drop, the Shanghai index has climbed 9.5 percent this year on expectations the government will relax monetary policies and take more measures to bolster equities.

The China Securities Regulatory Commission will accelerate the pace of approving qualified foreign institutional investors, Shanghai Securities News reported on Wednesday, citing Wang Lin, head of the fund supervision department at the CSRC.

China's overseas sales gains may have cooled further to 8.5 percent in April from a year earlier, while import growth probably doubled to 10.9 percent, according to economists' estimates ahead of a customs bureau report on Thursday. The trade surplus may have narrowed to $9.9 billion from $11.4 billion in April 2011.

China Cosco, the nation's biggest publicly traded shipping company, dropped 4.2 percent to 5.24 yuan (83 cents) and Cosco Shipping retreated 4.9 percent to 4.90 yuan.

Europe is China's biggest export market, receiving about 18 percent of the nation's overseas shipments, according to Shenyin & Wanguo Securities Co.

"There's already a lot of uncertainty this year because of the political changes, and if stimulus measures are stalled because the congress is postponed, that will have an impact on shares," Wan said.

Automakers drop

SAIC Motor, the largest Chinese automaker, slid 2.9 percent to 15.53 yuan. Beiqi Foton Motor Co, the biggest commercial-vehicle maker, lost 3.3 percent to 8.57 yuan.

Executives at unprofitable State-owned companies may not buy cars or high-end office supplies, or redecorate offices, Xinhua said, citing a joint statement from three government departments, including the Ministry of Finance.

Sany Heavy Industry, the biggest maker of excavators, fell 3.4 percent to 14.31 yuan. The demand for excavators dropped a "rather disappointing" 42 percent in April, Nomura said, citing data from China Construction Machinery Association.

There is a dearth of new construction, analyst Wenjie Ge said on Tuesday. The company said on Saturday that it may cut its unit-sales forecast for this year as government efforts to curb property speculation slow construction.

Zoomlion Heavy Industry Science and Technology Co, China's second-biggest maker of construction equipment, sank 1.8 percent to 10.18 yuan.