Beijing has reined in the pace of raising funds in the mainland's initial public offering market after Shanghai's benchmark stock index posted its worst three-week performance in almost a quarter of a century. The China Securities Regulatory Commission yesterday said it would approve fewer applications for mainland listings amid growing downward pressure on the stock markets, after a slew of stimulus measures from Beijing failed to shake shares out of a prolonged funk. Considering the recent market conditions, [we] will reduce the number of IPOs ZHANG XIAOJUN, CSRC The Shanghai Composite Index plunged as much as 7.2 per cent at one stage yesterday morning before closing down 5.77 per cent, or 225.85 points, at 3,686.92 - its lowest close since March. The CSRC also said it would investigate market manipulation and short-selling activities, after the China Financial Futures Exchange, which hosts and oversees trading of stock index futures, said it would closely monitor and probe illegal trading activities and premeditated short-selling. "Considering the recent market conditions, the CSRC will reduce the number of IPOs and the size of fund raising," CSRC spokesman Zhang Xiaojun said during a weekly briefing after the market closed. There were now 10 companies in the pipeline for IPOs early this month, he said, with the total amount of funds raised to be less than in June. The tech-heavy Shenzhen Composite Index dropped 5.3 per cent or 117.34 points to 2,098.48 and the ChiNext board retreated 1.66 per cent, or 44.04 points, to 2,605.28. The Shanghai Composite Index is down 29 per cent since hitting a seven-year high on June 12 and the Shenzhen Composite Index is down 32 per cent - both firmly in bear market territory. More than 1,400 companies were suspended from trading yesterday after reaching the daily downside limit of 10 per cent. In an effort to boost market confidence, executives at 11 Shenzhen-listed companies announced plans to buy back some of their shares. Sentiment among retail investors in Shanghai was mixed. "More than a week ago, my friend told me to withdraw all of my money from the market, and I didn't listen to his advice," one said. "I thought, on the contrary, it was a good time to buy in." Another investor said they were "still upbeat" and confident in the administration: "The highest point of the market was over 6,000 points many years ago and I believe the current economic situation is better than that time." The China Daily newspaper yesterday said the CSRC was investigating investors who used stock index futures to short the market and it would send criminal cases to the police. "Morgan Stanley reversed their bullish view on Chinese stocks on June 26, after a sharp drop in the Shanghai Composite Index," the Financial News , a People's Bank of China publication, said, questioning the US investment bank's motives. The China Financial Futures Exchange had suspended 19 accounts from short-selling for one month. Additional reporting Alice Yan Confidence boost China Securities Regulatory Commission (CSRC) said it would slow the pace of approving new share offerings in a move to shore up confidence in the mainland stock markets. China Securities Finance Corp, the only institution that offers margin lending to brokerages, will boost its capital base to about 100 billion yuan (HK$125 billion) from 24 billion yuan. CSRC said it had opened an investigation into market manipulation and short-selling activities after receiving reports of unusual movements in stock and futures markets.