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China stocks slump in early trade despite pledges of state intervention

(Reuters) – China stocks slumped further on Tuesday morning after their worst single-day drop in more than eight years in the previous session, shrugging off Beijing’s promises of more support for the market.

Stock regulators said late on Monday they were prepared to buy more shares to support the stock market, and would deal severely with anyone engaged in "malicious shorting."

Reuters reported that the state-run margin lender had repaid loans intended to support the stock market ahead of schedule, alarming investors who feared the government’s commitment to supporting the ailing market may be flagging.

The CSI300 index fell 3.1 percent to 3,698.70 points by 0131 GMT, while the Shanghai Composite Index lost 3.4 percent to 3,598.10 points.

China CSI300 stock index futures for August pointed to further losses, falling 3.3 percent to 3,635.6, or 63.10 points below the current value of the underlying index.

In Hong Kong, the Hang Seng index dropped 0.6 percent, to 24,199.92 points.

The Hong Kong China Enterprises Index lost 1.1 percent, to 11,106.97. (SHANGHAI/July 28/2015)

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