A raft of government-led emergency measures aimed at arresting China's nose-diving sharemarkets has fallen embarrassingly short, with sustained selling on Monday wiping out most gains from the benchmark Shanghai index's best start to a trading session since 2008.

The result has left analysts questioning both the ability and rationale of the government and financial regulators to stem losses that have stretched to more than $US3 trillion in the past three weeks, and the extent to which a continued free-fall in the market will impact the broader economy.

"Clearly the reaction from the market was nowhere near what was hoped for," said Fraser Howie, managing director of Newedge Singapore and an expert on China's capital markets.

"When you look at the raft of measures … everything including the kitchen sink was thrown at the market and yet the performance come the end of the day was pretty dismal, frankly."

China's intervention into its ailing stockmarket is also seen as a setback to the central government's promised moves toward greater financial liberalisation, with the pipeline of planned IPOs seen as one step toward reforming the state-owned sector. A key doctrine of last year's policy-setting Third Plenum was to allow markets play a "decisive factor".

"The big message from all this is that financial liberalisation will move a lot more slowly than people were expecting," said one Beijing-based asset manager, who declined to be named.

Since mid-June, the benchmark Shanghai Composite Index has tumbled by 29 per cent in three weeks, including a 12 per cent loss last week. For the Shenzhen Component Index and the ChiNext, the start-up board, the losses were even deeper.

In a wild day's trade even by the Shanghai Composite's recent volatile standards, the index surged 7.8 per cent higher at Monday's open to reach 3975.32 points, but shed nearly half those gains within 10 minutes before steadily losing ground.

Shortly after the luncheon break, the index had dipped into negative territory before spending the rest of the afternoon fighting to stay above water. A late surge in the final half-hour of the session saw the index close 2.4 per cent higher at 3775.91 points.

China's other major bourse, the tech-heavy Shenzhen Exchange, was down for most of the day and closed 1.39 per cent lower at 12075.77.

The weak performance comes as a particular embarrassment for the Chinese government who threw considerable energy behind efforts to bolster market confidence.

Over the weekend, the government brought in its central bank, the People's Bank of China, and an investment arm of the country's sovereign wealth fund to join 21 major brokerage firms to contribute to a market stabilisation fund investing in blue-chip stocks. It also halted 28 pre-approved initial public offerings to further stabilise the market.

The moves were also backed by a propaganda offensive, with the Communist Party's official news outlets in unison over the country's leadership being "capable and confident" of keeping capital markets "stable and sound".

"It is an urgent task to bring the A-share market back to a rational track, as volatility of the market is detrimental to the sound and stable development of the capital market," the People's Daily, the Communist Party's flagship newspaper, said in a prominent editorial on Monday.

Arguably closer to the thoughts of most investors was an incisive editorial carried in respected financial magazine Caixin, which asked whether securities regulators had already "lost their way".