CHINESE police Thursday joined the securities regulator to probe clues related to “malicious short selling” amid recent chaos in the stock market.

    Vice Minister of Public Security Meng Qingfeng led a team and visited the head office of China Securities Regulatory Commission (CSRC) on Thursday morning, a sign that authorities are keeping a close watch for illegal trading.

    The banking regulator, China Banking Regulatory Commission, on Thursday announced it will allow banks to extend mortgage loans that use share funds as collateral. Banks will now be able to discuss redefining mortgage terms of share-secured loans that are due or adjusting collateral with their clients.

    The benchmark Shanghai Composite Index surged 202.14 points to end at 3,709.33 Thursday. It fell as much as 3.81 percent and rose up to 6.88 percent during the day — an overall range of more than 10 percent.

    The ChiNext Index, tracking China’s Nasdaq-style board of growth enterprises, climbed 3.03 percent to end at 2,435.76 points, with all 194 stocks available for trading rising by the daily limit of 10 percent.

    Only two stocks lost in Shanghai and Shenzhen at the closing. More than 1,000 shares on the two bourses jumped by the daily limit of 10 percent.

    Hong Kong’s Hang Seng Index also rebounded sharply, after its biggest fall in seven years Wednesday, rising 3.5 percent Thursday.

    The official Global Times newspaper said in a commentary that the stock market crisis “does not reflect the fundamentals of the Chinese economy.” It said China had “an unparalleled ability to mobilize resources to accomplish large undertakings,” and it rejected criticism of the government’s efforts to shore up the market, saying “All we need is confidence to overcome the hurdle.”

    (SD-Agencies)