“The securities regulator is said to have held a closed-door meeting with analysts, that may have fueled expectations there’ll be some moves to stabilize the market,” Yip told Bloomberg.

Chinese equities have plunged into a bear market since the January highs due to a variety of factors, including Beijing’s deleveraging campaign and its impact on liquidity, a trade dispute with the U.S., a depreciating yuan currency and signs of a slowing economy.

Year-to-date, the iShares China Large-Cap ETF (NYSEArca: FXI) declined 8.9% and Xtrackers CSI 300 China A-Shares ETF (NYSEArca: ASHR), which tracks mainland Chinese A-shares, plunged 21.2%.

“Authorities certainly don’t want to see stocks slide further, valuations at current levels appear attractive, though it would be hard to revive sentiment on the market,” Shen Zhengyang, a strategist with Northeast Securities Co., told Bloomberg. “The trade negotiations that are dragging on will continue to cloud the market outlook.”

For more information on the Chinese markets, visit our China category.

Subscribe to our free daily newsletters!
Please enter your email address to subscribe to ETF Trends' newsletters featuring latest news and educational events.