The Chinese stock market suffered a sharp drop Monday, with ChiNext index down to a new low, despite the release of better-than-expected GDP data.

The benchmark Shanghai Composite Index dropped 1.43 percent to 3,176.46 points. The smaller Shenzhen Component Index slumped 3.57 percent to 10,055.80 points.

The sharpest decline came from ChiNext Index, China's NASDAQ-style board of growth enterprises, which lost 5.11 percent to close at 1,656.43 points.

Analysts said investor confidence in the ChiNext was weak as concerns are rising over the prolonged plight of Leshi Internet Information and Technology Corp., a leading growth firm listed on the board.

Guangdong Wens Foodstuff Group Co., a firm listed on ChiNext with large market capitalization, slumped 8.14 percent as the company predicted a profit decline for the first half in an announcement earlier.

Small caps were also less attractive as blue chips have become the new favorite. Specifically, the performance of the insurance and banking sectors provided investors with some comfort.

Ping An Insurance (Group) Company of China. Ltd., a domestic insurance giant, and China Citic Bank Corporation Limited, a major bank, climbed by 2.14 percent and 6.14 percent respectively.

"The sharp decline in the growth enterprise market will cause negative effects on both Shanghai Composite Index and Shenzhen Component Index. After the drop, a market rebound may occur," said Yang Delong, chief economist of First Seafront Fund.

Monday's plunge came despite the release of forecast-beating GDP data, which went up 6.9 percent year on year to about 38.2 trillion yuan (5.6 trillion U.S. dollars) in the first half of 2017, data from the National Bureau of Statistics showed.

In the second quarter, China's GDP held steady, posting a rise of 6.9 percent year on year, flat from the first quarter and slightly higher than previous market consensus of 6.8 percent.

The reading is well above the government's target for the year of 6.5 percent.