A man pays attention to stock market quotation at a business lobby of a security company in Huaibei, east China's Anhui Province, July 27, 2015. The Shanghai Composite Index dived more than 8 percent Monday, the biggest daily drop since 2007. (Xinhua/Xie Zhengyi)
China Securities Finance Corporation, Ltd. (CSF) will continue to buy stocks to stabilize the market, the securities watchdog said on Monday.
Zhang Xiaojun, spokesperson with the China Securities Regulatory Commission (CSRC), made the remark after the benchmark Shanghai Composite Index experienced the sharpest daily drop since Feb. 27, 2007, dispelling rumors that the national margin trading service provider has backed off from stabilizing the stock market.
CSRC is investigating huge stock sell-offs by some individuals and will punish any malicious short selling, Zhang added.
China stocks in sharpest drop since 2007
Chinese shares slumped on Monday as investors unnerved by weak economic data dumped their shares to lock in profits following last week's rally, sinking the benchmark index into the worst single-day loss in eight years.
The benchmark Shanghai Composite Index plunged 8.48 percent to close at 3,725.56 points, in the sharpest daily drop since Feb. 27, 2007. The smaller Shenzhen Component Index fell 7.59 percent to close at 12,493.05 points.
Nearly 2,000 shares fell by the 10-percent daily limit.