New | Beijing's efforts to prop up stock market fall flat leaving investors 'confused'

Beijing's relentless efforts to prop up the stock market have hardly moved the benchmark gauges as the problem lies in the economy rather than the markets.

"International investors are pricing in the risks embedded in China's economy or deterioration, or a possible financial crisis. But the sell-off has been overdone," said UBS economist Donna Kwok.

"The key is not how the stock market reacts, but how the real economy goes. We do not think the government should save the market with an expansive cost," said Kwok, but added that Beijing's policy support to prop up the economy had been relatively successful so far.

"If not for this support, infrastructure investment would not have broken away from the continued slide in property and industrial investment - and overall economic growth would not be holding up at current levels."

Beijing has had a busy schedule, rolling out fresh policies, orders and guidances on almost a daily basis in past weeks - from fresh monetary easing and allowing pension funds to trade more stocks to calling for more dividend payouts by state firms and slapping penalties on trading platforms. For some, it's all a bit too much, with the buzz of activity getting increasingly chaotic.

"The government is sending confusing signals in a flaccid economy. Capital is leaving the country. The stock market is only reflecting that sentiment," said Kevin Lai, an economist at Daiwa Capital Markets.