Shanghai's index rallied by more than 150 per cent in the 12 months to the middle of last month in a meteoric rally but has since fallen by more than 30 per cent. Photo / AP
Chinese stocks staged a spectacular comeback yesterday after Wednesday's horror losses.
The Shanghai Composite Index initially dropped by more than 3 per cent after trading commenced, before gaining back ground after the China Banking Regulatory Commission said it would relax margin requirements.
Investors with holdings of more than 5 per
cent, as well as corporate executives and directors, have also been prohibited from selling their holdings for six months.
Meanwhile, Chinese police and security regulators yesterday launched a joint probe into "vicious short-selling" - profiting from falls in the country's volatile equity markets.
The Shanghai index, which fell 5.9 per cent on Wednesday, was up 4.9 per cent at 6pm, while the Shenzhen Composite Index had gained 3.6 per cent.