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Chinese regulator investigates share-dumping

An investor watches the electronic board at a stock exchange hall in Fuyang, China.
ChinaFotoPress | Getty Images
An investor watches the electronic board at a stock exchange hall in Fuyang, China.

China's securities regulator said on Tuesday that it had launched an investigation into Monday's selloff on the country's stock markets, as the rout in Chinese equities continued.

In a transcript of a Q&A posted on its website, China Securities Regulatory Commission (CSRC) said it was "looking into incidents of share-dumping" on July 27.

Read More China stock exodus: When will it end?

China's benchmark stock market slid 8.5 percent on Monday, suffering its biggest daily loss since 2007. The Shanghai Composite pared some losses during trading Tuesday to end the day down 1.68 percent.

Chinese stock markets have had a wild ride this year– with the stock index rising a hefty 60 percent in the first half of the year only to slide 30 percent since a June peak.

The plunge has raised concerns about financial stability and a protracted economic slowdown in the world's second biggest economy that would have knock-on effect on global growth.

-- By CNBC's Katrina Bishop. Dhara Ranasinghe also contributed to this report.