Stocks linked to the FTZ posted modest gains after falling on profit-taking in recent sessions. Shanghai Jinqiao Export jumped over 4 percent while Shanghai Waigaoqiao rallied 3.7 percent.
Retailers also lent support as investors bet on positive sales over the week-long holiday. Beijing Wangfuijing Department Store rallied over 6 percent while BesTV New Media surged by the daily trading limit of 10 percent.
The index continued to trade below its 200-day simple moving average (SMA) of 2,189 points for a second straight session.
Sydney slips 1.6%
Australia's share market fell from Friday's five-year high in its biggest one-day drop since early August, dragged down by steep losses in energy producers.
White Energy slumped 12 percent while Linc Energy and Paladin Energy lost 8 and 5 percent, respectively after Brent slipped below $108 a barrel.
(Watch now: Time to invest in unloved resources plays: Pro)
Meanwhile, the Australian dollar eased as much as half a percent against the greenback after China's weak factory data.
Investor attention turned to the Reserve Bank of Australia's (RBA) central bank meeting on Tuesday, where the central bank is widely expected to keep interest rates unchanged.
India down 1.2%
India's benchmark index fell to a three-week low on caution ahead of the April-June current account deficit data, due out later in the session.
Kospi eases 0.7%
South Korean investors shrugged off positive economic data and a stronger Japanese currency to track Asia-wide losses.
Industrial output hit a nine-month high in August, indicating that local manufacturers in South Korea's export-heavy economy are recovering. Still, blue-chip exporters headed lower with automakers Hyundai Motors down 2 percent while memory chip maker LG Display fell 3 percent.
— By CNBC.com's Nyshka Chandran. Follow her on Twitter