Shanghai's stock market dropped the most in two weeks after commodity producers fell and property shares were weak.

The Shanghai Composite Index lost 1.44 percent, or 38.94 points, to close at 2,656.35. Turnover was 157.3 billion yuan (US$23.2 billion).

Heavily weighted energy shares and steel producers dragged the index down. China Shenhua Energy Co, the country's biggest coal producer, fell 2.1 percent to 23.72 yuan. PetroChina was down 1 percent to 10.19 yuan. Baoshan Iron & Steel Co lost 3.31 percent to 6.71 yuan.

"The index may fluctuate around 2,660 points before the announcement of macroeconomic data for August as most investors remain cautious about macroeconomic policies in the future," Xiangcai Securities wrote in a research note.

Commodity producers retreated as metal and rubber prices dropped in Shanghai after the Securities Times reported that the China Securities Regulatory Commission was investigating a Zhejiang-based brokerage of alleged manipulation of the natural rubber market.

Jiangxi Copper Co fell 1.69 percent to 33.81 yuan. Shandong Gold Mining Co slid 3.51 percent to 43.71 yuan. Zijin Mining Co was down 3.13 percent to 6.50 yuan.

Follow-up measures will be introduced to curb the real estate market. China Vanke Co, the nation's biggest listed company, slid 3.38 percent to 8.28 yuan amid concern. Gemdale Corp lost 1.69 percent to 6.41 yuan.