JAKARTA (Yosefardi) – The Shanghai market dropped 7.5% in afternoon trade on Monday (Jan 19) on concern over the trading margin curb imposed to 3 securities firms.

At 1.38 pm Jakarta time, SSE Composite index dropped 7.5% to 3122.80. It had gained 51.8% since mid July 2014.

The country’s securities regulator imposed margin trading curbs on several major brokerages, a sign that authorities are trying to rein in the market’s big gains, Reuters reported.

The China Securities Regulatory Commission imposed curbs late Friday on margin financing, or borrowing to purchase stocks, following an investigation of the industry.

The three affected brokerages, Citic Securities Co., Haitong Securities Co. and Guotai Junan, were forbidden to lend money and shares to new customers for three months after they allegedly were caught extending margin trading contracts in violation of the rules.

Investors are also awaiting China’s economic growth data due Tuesday, which is likely to show a further slowdown in the fourth quarter.