Husks of vehicles littered the pavement near the shrine as first responders rushed to the scene while armed security forces fanned out in the area.
According to police, five of those killed were security personnel.
The blast could not immediately be ascertained as a suicide blast.
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Shanghai's benchmark index fell 5.6 percent Monday despite China's efforts to limit the anticipated selloff, Bloomberg reported . The president said last month that Washington and Beijing were close to reaching a "monumental" agreement.
The president deplored the loss of precious lives in the incident and said those involved in such despicable incident in the holy month of Ramzan are misguided elements.
Blast outside Data Darbar left at least eight people dead on Wednesday. "The target was police", said Syed Mubashir Hussain, a spokesman for the Lahore police, as quoted in a report by Reuters. "We condemn this cowardly act", he said and also confirmed it was suicide attack.
A van carrying police officers outside the largest Sufi shrine in South Asia-where hundreds of pilgrims were present when the blast took place -was targeted.
Raja Basharat, a senior provincial minister in the Punjab Government, said police were still trying to determine the nature of attack, which might have been a suicide bombing.
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According to Shahbaz Gill, spokesperson for chief minister Punjab, the suicide bomber was 15-years-old.
Three police officials, a security guard and a civilian were killed, he added.
Sufi worshippers, who follow a mystical strain of Islam, have frequently been the target of bloody attacks by Islamist militants including the Islamic State group in Pakistan. "The injured will receive the best care available".
Over the past two years Lahore, Pakistan's second largest city, has been free of the kind of attacks that were once common.
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