CHINA’S stock regulator yesterday reaffirmed regulatory support for the country’s equity market, denying a media report that it was studying a withdrawal of government funds used to stabilize the market after its earlier 30 percent plunge.

    “Over the next stage, the China Securities Regulatory Commission (CSRC) will continue stabilizing the market, with goals of stabilizing sentiment and preventing systemic risk,” spokesman Zhang Xiaojun was quoted as saying in a statement.

    China injected hundreds of billion yuan of liquidity into brokerages and mutual funds to support its equity market after it slumped 30 percent in three weeks from June 12.

    Influential Chinese magazine, Caijing, reported yesterday morning that the CSRC was now studying channels for the withdrawal of government funds.

    “The report is untrue,” Zhang was quoted as saying. “The related media was irresponsible for making such a major market-moving report without checks with the supervisory department,” Zhang said.

    The Caijing also reported yesterday morning that the CSRC was not currently considering setting up a market stabilization fund, as some other media had previously speculated.

    The CSRC’s statement did not mention this report.

    The Caijing, however, deleted both reports after the CSRC statement. The magazine was not immediately available for comments.

    China’s stocks erased early losses and ended higher yesterday, after the securities regulator reaffirmed its support for the market.

    But analysts say investors are increasingly cautious as the Shanghai Composite Index, which yesterday gained 0.88 percent to 3,992.11 points, approaches 4,000 points, viewed by many as a key psychological level. (SD-Agencies)