China stocks break 4-day winning streak, regulatory concerns linger

SHANGHAI (Reuters) - China stocks snapped a four-day winning streak to end lower on Wednesday, as investors remained cautious amid lingering concerns over tighter regulation and economic growth despite recent soothing regulatory comments.

The blue-chip CSI300 index fell 0.5 percent, to 3,409.97 points, while the Shanghai Composite Index lost 0.3 percent to 3,104.44 points.

Chinese stocks had declined for five weeks in a row amid concerns that Beijing's stepped-up efforts to reduce leverage in the financial system would trigger liquidity stress and damage the economy.

But the market rebounded in the past sessions after Beijing moved to ease investor concerns through generous cash injections in the interbank market and market-friendly comments.

"After the panic selling triggered by tighter regulations, the market is pausing for breath," said Wu Kan, head of equity trading at Shanshan Finance.

"But the stability could be temporary. Future direction depends on the pace of tightening and economic conditions."

Most sectors lost ground, led by defensive consumer and healthcare stocks, as investors took profits from the recent rally.

Small-caps continued to outperform, with the tech-heavy start-up board ChiNext rising for the fifth straight session.

(Reporting by Luoyan Liu and John Ruwitch; Editing by Jacqueline Wong)