Chinese shares opened 1.27 percent lower on Friday, dragged down by overnight losses in the U.S. market.

The the benchmark Shanghai Composite Index lost 40.14 points to open at 3,118.72 points.

The Shenzhen Component Index sank 1.24 percent, or 160.23 points, to open at 12,756.92 points.

China Railway Group Ltd., the country's largest construction company, opened 0.17 percent higher to 5.9 yuan (0.8 U.S. dollars) after it said the company expected to see profits quadrupled in 2009 in a statement filed to the Shanghai Stock Exchange late Thursday.

Inner Mongolia Baotou Steel Rare-earth (Group) Hi-tech Co. opened 0.9 percent lower to 25.7 yuan, as the company forecasted losses in last year's profits.

Preliminary accounting showed profits in 2009 dropped 60 percent to 70 percent, the company's said in a statement to the Shanghai Stock Exchange before trading hours.

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