By Mark Magnier, William Kazer and Richard Silk 

BEIJING--China's industrial production grew at a slower pace in November providing the latest snapshot of weakness in the world's second-largest economy amid lackluster domestic demand and the temporary closure of thousands of factories for an international meeting.

While the loss of momentum reported Friday in industrial production, a closely watched gauge of factory output, was partially offset by improved retail sales, it wasn't enough to reverse China's broader slide.

"This reconfirms what all the other data says, that the slowdown in China continues unabated," said Société Générale CIB economist Klaus Baader. "On the whole, it's a pretty disappointing set of numbers."

The weaker-than-expected factory output figures dovetail with a number of other recent signs of economic weakness in manufacturing, including lower steel production, reduced coal consumption by the nation's six largest power companies and lower purchasing managers index readings.

Fixed asset investment on a year-to-date basis also slowed last month on sluggish factory investment. And housing sales fell at a faster rate last month than in October, undercutting investor hopes that the worst was over in this economically vital sector.

"I thought that the pickup would be short-lived, but it's been even shorter-lived than I expected," said UBS economist Wang Tao.

While Beijing's decision to host the Asia Pacific Economic Cooperation meeting last month may have boosted China's global image, it didn't help its economy, analysts said.

Some 40,000 construction sites and over 9,000 factories saw production temporarily halted and another 4,000 factories slowed down during the 12-day period around Beijing leading up to the early November meeting to check air pollution, said Goldman Sachs, which estimated that this may have reduced November's industrial output by 0.5 percentage points.

"Heavy industries are still a major part of the industrial sector," said HSBC economist Ma Xiaoping. "Guess there's a price to pay for blue skies."

Cement, chemicals and particularly steel factories in the region around the capital were hard hit, cutting China's November crude steel production by 5 percentage points, UBS said.

Retail sales last month provided some much-needed positive news tied to strong online sales during Singles' Day--a holiday devoted to unmarried people--although some analysts said they expected consumers to dial back a bit in December after the concentrated shopping binge.

Online sales jumped on Nov. 11 with website Tmall reporting a 65% rise, JD.com reporting that sales tripled and GOME posting an almost sevenfold sales rise, year-over-year, prompting department stores to counter with their own sizable discounts that boosted sales further.

China's National Bureau of Statistics said Friday that industrial production growth was 7.2% year-over-year in November, below market expectations and down from growth of 7.7% in October.

Fixed asset investment in nonrural areas rose 15.8% in the January-November period, the statistics agency said, down from a gain of 15.9% in the first 10 months. And retail sales grew 11.7% year-over-year last month, the statistics agency said, a slight increase from the 11.5% rise reported in October.

In the economically vital real estate sector, housing sales last month fell 12% by value, compared with the same month of 2013, more than the 3.1% on-year drop in October. Ms. Wang of UBS said China's stumbling property market--which has hit construction hard and threatens to drag down other industries from steel to furniture--represents the biggest risk by far to the Chinese economy.

Beijing released the weak economic indicators one day after the nation's policy makers said at a policy meeting that they would try to balance steady economic growth and structural reforms next year. While the government didn't announce a 2015 growth target at the meeting, called to set economic priorities for next year, it is widely expected to be below this year's level of about 7.5%.

"China still has some challenge to deliver its 'around 7.5%,'" said ANZ economist Hao Zhou.

China's gross domestic product grew at 7.3% year-over-year in the third quarter, its lowest pace in five years. Beijing said on Thursday its main targets for this year are within reach.

Liyan Qi

Write to Mark Magnier at mark.magnier@wsj.com, William Kazer at william.kazer@wsj.com and Richard Silk at richard.silk@wsj.com

Access Investor Kit for The Goldman Sachs Group, Inc.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US38141G1040

Goldman Sachs (NYSE:GS)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Goldman Sachs Charts.
Goldman Sachs (NYSE:GS)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Goldman Sachs Charts.