Trading fees in China's financial markets have been cut three times this year, which “alleviates market costs and reflects regulator's confidence and determination to protect the interest of investors and boost the healthy development of the market,” according to the statement.

Eoin Treacy's view Raising the tax on equity transactions was one in a range of policy tools utilised by the Chinese authorities to prick the stock market bubble in 2007. It is therefore logical that in their efforts to support the market they would reduce the cost of trading. However additional stimulative efforts are likely required to reinvigorate bullish sentiment.

The Shanghai A-Share Index's decline has resulted in more attractive valuations with the P/E falling to 11.69 and the dividend yield rising to an historic 2.39%. Significant rallies have previously been initiated when valuations have approximated these levels.

The index is dominated by banks, materials and industrial companies. As the monetary authorities have leaned on the property sector and withdrawn stimulative measures, these sectors in particular have borne the brunt of selling pressure.

The most prominent consumer oriented share in the Index, at a weighting of 1.73%, is Kweichow Moutai Co Ltd which in common with international brewers have been trending relatively consistently. The share has unwound an overextension relative to the 200-day MA and has returned to test the medium-term progression of higher reaction lows. It will need to find support in this region if the pattern of demand dominance is to remain consistent.

At 25% of the S&P/Citic300 Consumer Staples Index how Kweichow Moutai performs will have a considerable influence on the sector. It has pulled back from the upper side of the 18-month range and a sustained move above 6000 will be required to confirm a return to medium-term demand dominance.