REFILE-China stocks rebound sharply on share sale ban, fresh gov't support
(Refiles to clarify reference to "small caps" in paragraph 5)
SHANGHAI, July 9 (Reuters) - China shares rebounded sharply on Thursday, with the Shanghai Composite index posting its biggest percentage gain in six years, as a fresh round of government support measures stemmed panic selling.
But some analysts warned that it was too early to say if savage market correction was over, noting that the pace of deleveraging is accelerating and the market performance is being distorted by the fact that over half of China's listed companies have halted trading
The Shanghai Composite jumped 5.8 percent, to 3,709.33 points, its biggest rise since March, 2009. The CSI300 index of China's biggest listed companies surged 6.4 percent, to 3,897.63.
Most of the 1,401 stocks still trading in Shanghai and Shenzhen surged their 10 percent daily limit. Only four stocks fell.
The sharp rebound came after China's state margin lender said it was broadening its bailout buying to include small cap stocks and mutual funds, rather than just blue chips.
The market also drew support from drastic measures unveiled by the securities regulator that banned shareholders with large stakes in listed firms from selling for the next six months.
But some analysts questioned if the market was really steadying after plunging some 30 percent since mid-June.
"It is far from calling it a victory for the rescuers as more than half of listed companies are not trading in the market," said Du Changchun, analyst at Northeast Securities in Shanghai. Continuación...