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One of China's leading stock indexes has seen its highest daily spike in more than two years following signs that the government will step in to support battered equity markets.

The Shanghai Composite closed up 4.1%, its biggest one-day rise since March 2016.

The moves extend a rally that began on Friday and after investor confidence surged on assurances from Beijing.

Stocks had been falling as China's economic growth continued to stutter.

On Friday, top Chinese financial officials - including economic adviser Liu He and the heads of the securities and insurance commissions - issued a statement to buoy investor sentiment in bruised markets.

"The barrage of headlines from key Chinese officials on Friday was deafening and extremely co-ordinated, which has been to great effect," Pepperstone analyst Chris Weston said in a research note.

Over the weekend, the government published a draft of new rules for personal tax deductions, according to Reuters.

The moves come as the world's second largest economy faces challenges such as high debt levels and an intensifying trade war with the US.

Data out Friday showed that in the third quarter of the year, the Chinese economy grew at the slowest rate rate since the global financial crisis, expanding by 6.5% from a year earlier.

The rate was a drop from the 6.7% pace in the prior quarter, but remains in line with the government's full-year target of about 6.5%.

For years China has pushed to wean its economy off exports and rely more on domestic consumption for growth.

At the same time, the government has been fighting to contain ballooning debt driven by a wave of infrastructure development and a housing bubble without hurting growth.

In recent months Beijing has taken steps to support its economy, including cutting capital requirements to boost liquidity and ease the slowdown.