A new 'circuit-breaker', which is designed to ease volatility, kicked in within the first hour of trading.
Investors have not been reassured by the Chinese government's attempts to shore up the markets and encourage higher economic growth rates.
China's central bank has also moved again to weaken the yuan, in an attempt to boost exports.
Danny Cox from stockbroker Hargreaves Lansdown says many investors are panicking.
IN: "It was…
OUT …away."
DUR: 31 seconds
http://www.fsnradionews.com/feeds/0107china-cox1.mp3
ALT:
Danny Cox from stockbroker Hargreaves Lansdown says interventions by Chinese authorities are not having the desired effect.
IN: "The problem…
OUT …markets."
DUR: 31 seconds
http://www.fsnradionews.com/feeds/0107china-cox2.mp3