CITIC Securities moved Friday to tighten margin trading rules for the second time in less than a month, offering fresh signs that a government-directed campaign to reduce leverage in China’s stock market is accelerating.

    The move, which CITIC said is aimed at preventing the risk of clients holding excessive margin positions in a single stock, followed a raft of tightening measures announced by its industry peers.

    Fresh moves to tighten margin financing requirements are being closely watched because investors have borrowed more than 2 trillion yuan (US$322.21 billion) from brokerages to dive into one of China’s biggest stock market bull runs.

    CITIC Securities said it would adjust the ceiling that caps a client’s holding in a single stock relative to the client’s total assets in the trading account, in order to prevent risk concentration.

    The new rules will take effect July 1, CITIC Securities said.

    On Thursday, small-sized brokerage Golden Sun Securities suspended margin financing for purchases of shares listed on Shenzhen’s growth board ChiNext, triggering panic selling in early afternoon trading, though the market recovered the losses later.

    Other brokerages, including Guosen Securities Co., Southwest Securities Co. and Changjiang Securities Co., also tightened margin financing rules over the past week.

    China’s securities regulator has punished or disciplined a number of brokerages for margin trading irregularities this year, barring some from opening new margin finance accounts. (SD-Agencies)