The news pushed down the local market, with the S&P/ASX 200 index falling 0.28% or 11.23 points to 4055.80, while the All Ordinaries followed suit, shedding 12.58 points to 4106.20.

The preliminary reading for a purchasing managers index released by HSBC Holdings and Markit Economics today added to signs the slowdown in China’s economy is deepening and follow worse-than-forecast data from Japan and Taiwan yesterday.

Yesterday, Chinese leaders vowed to intensify the fine-tuning of policies to bolster growth amid softening demand for its goods in Europe.

“China is already behind the curve with its monetary policy. They have to add before it is too late, given that the external market is very fragile and the European debt crisis is looming,”Bloomberg quoted Hong Kong-based Sun Hung Kai Securities strategist Daniel So.

Speaking of Europe, the region’s leaders have already clashed over joint debt sales as they called on Greece to stick with the budget cuts needed to stay in the eurozone and offered no immediate relief for recession-wracked Spain.

The 18th European Union summit in more than two years of crisis fighting was marked by new French president Francois Hollande’s challenge to the German-dominated deficit-cutting orthodoxy that has failed to stabilise the euro area and led to speculation that Greece might be forced out.

Locally, the major miners were mixed, with shares in BHP Billiton up 6c to $31.99, while Rio Tinto gained 8c to $56.36, Fortescue Metals Group shed 8c to $4.48, OZ Minerals dropped 15c to $8.13 and Paladin Energy closed 1c higher on $1.20.

Gullewa was one of the big movers of the day, climbing 55% or 3.5c to 9.8c on no news, as was Malagasy Minerals which jumped 29% or 2.5c to 11c on no news.

The wooden spoon of the day went to Riedel Resources, which dropped nearly 26% or 2.7c to 7.8c after a change in substantial shareholder notice was lodged showing Golden Rim Resources had reduced its stake to 15.64% from 17.65%.

The day before Riedel was one of the big movers of the day, climbing 38% to 10.5c after returning high-grade gold assay results from rock chip sampling at its Tagou gold project in Burkina Faso.

Companies entering trading halts included Northern Star Resources, Venturex, Investigator Resources and Flinders Mines.

The latter related to a pending announcement regarding a hearing on the merits of a motion with the Arbitration Court of Chelyabinsk in Russia connected to a scheme implementation agreement between Flinders and Magnitogorsk Iron and Steel Works struck last November.

Investigator’s trading halt related to a proposed capital raising, while Northern Star and Venturex were connected to corporate transactions.

Gold stocks were also mixed with Australia’s largest locally owned miner Newcrest Mining gaining 16c to $24.90, while shares in Alacer Gold Corp dipped 6c to $6.05 and Kingsgate Consolidated dropped 4c to $4.96.

The Australian dollar remained below parity with the greenback and was fetching US97.5c against the greenback at 4.08pm (AEST).