China moved to contain leveraged wagers on its stock market, cutting by half the amount of borrowed money investors can use to buy shares, as authorities seek to prevent a repeat of the excesses that led to a $US5 trillion rout earlier this year.

Margin requirements will be raised to 100 per cent from 50 per cent starting on November 23, the Shanghai and Shenzhen bourses said in separate statements after local exchanges closed on Friday. The rule change means that an investor with 1 million yuan ($US156,895) in their account is limited to borrowing another 1 million yuan from a broker to buy more shares. Previously, they could borrow as much as 2 million yuan.

"I think ultimately it's a very good thing in the long-run," Brendan Ahern, managing director at Krane Fund Advisors LLC in New York said by phone on Friday. It will "certainly will help de-risk, or take down, some of the inherent volatility in the market".

China's securities regulator on Thursday night suspended its new stock circuit-breaker that caused the sharemarket halts this week. Getty Images

While the move is likely to weigh on investor sentiment when mainland markets re-open on Monday, the Shanghai bourse said it will help prevent systemic risks from building in China's financial system. Surging margin debt helped amplify the record-breaking boom - and subsequent bust - in Chinese stocks earlier this year as ready access to leverage gave the country's millions of individual investors increased buying power.

Margin financing, which shrank by more than half during the rout, has been rising for six straight weeks as the Shanghai Composite Index bounced back into a bull market. The decision to tighten investor access to the loans comes a week after regulators lifted a freeze on initial public offerings, removing one of the key measures of support for equities.