BEIJING: China stocks clawed back sharp early losses on Wednesday amid speculation that the government is putting fresh pressure on brokerages to support the market.
Nine Chinese brokerages have pledged additional funds worth over 30 billion yuan ($4.71 billion) to buy shares, the China Securities Journal said on Wednesday.
The estimates by the Journal followed Tuesday’s announcement by several Chinese brokerages that they would increase the size of their proprietary trading as weeks of turmoil in mainland markets showed little sign of abating.
After slumping as much as 4.4 percent in early trade, the CSI300 index was down only 0.2 percent at 3,356.67 points by lunch time.
The Shanghai Composite Index also reversed early losses of up to 4.6 percent, and ended the morning up 0.3 percent at 3,176.34 points.
Improving sentiment on the mainland also helped Hong Kong stocks recoup early losses.
A number of Chinese brokerages, including Guotai Junan Securities Co, Changjiang Securities and Pacific Securities have pledged additional funds to buy shares, the China Securities Journal said, answering fresh government calls to support the wobbly stock market.
