Policy decisions on the market restraints and allowing the yuan to freefall have dumbfounded analysts.
China has suspended a circuit-breaker implemented at the start of the year to stop trading for the day when the benchmark index fell 7%.
The halt was triggered twice this week and is now suspended.
Craigs Investment Partners broker Chris Timms expressed concerns yesterday the Chinese market could go into freefall but fears were allayed as the market rose 2% in early trading.
It was still likely the Government's restrictions on financial institutions selling shares would be extended as Beijing battles to get control of its economy.
In a move that deepened concerns about China's economic health, the People's Bank of China set the yuan midpoint rate lower for the eighth consecutive day.
The yuan firmed yesterday after the bank strengthened its official rate for the first time in nine days.
The bank had spent tens of billions of dollars of foreign reserve holdings in recent months to bolster a falling yuan.
Mr Timms said Beijing had been selling dollars to keep the currency from "falling out of bed'', in a major change in policy.
Investors feared China's economy was even weaker than previously imagined after the Government allowed the biggest fall in the yuan in five months on Thursday, pressuring regional currencies and sending global stock markets tumbling.
The Chinese economic troubles could complicate the Federal Reserve's plan to raise its official lending rate.
An increasing number of New Zealand economists are now calling for further cuts in the official cash rate, perhaps down to 2% within six months.
There were concerns within the Fed about China, particularly whether a slowdown there could affect US economic growth and jobs or pull down global inflation and keep the Fed from reaching its 2% inflation goal, according to minutes from its December policy meeting released this week.
