Monday's plunge in mainland shares, the steepest fall in eight years, doesn't by itself constitute proof that the government's efforts to stem the market rout have met with failure.

It is likely that some investors might take fright as some blue-chip stocks such as PetroChina - which have remained strong and have supported the market even amid recent sell-offs - also fell on Monday, resulting in an across-the-board tumble.

However, the one-day drop hardly suggests that the government's efforts to restore stability in the market have hit a roadblock.

In a statement posted on its website late Monday, the country's securities regulator also rejected speculation that State-backed rescue efforts have been tailing off.

With a whole raft of supportive measures in place, the market has actually seen a substantial rebound in the last two weeks, an indication of the effectiveness of the measures.

The market sell-off on Monday was essentially a spontaneous correction. With the benchmark Shanghai Composite Index having hovered around the 4,100-point level in recent days, and with no imminent signs of a conspicuous rise, investors may have decided on the sell-off to make a profit from the recent rebound.

The sharp fall in shares has been propelled to a certain extent by a rapid deleveraging process that itself was triggered by efforts to curb margin financing and the raising of credit through unregulated trading platforms.

Since the securities regulator is still pursuing its efforts to tighten up on such activities, the stock market will continue to be volatile for the time being.

But the plunge, rather than spurring a new prolonged slump, partly reflects the process of market forces contending to find a balance in stock valuations.

Also, travails in the stock market shouldn't be regarded as symptomatic of a wider financial crisis. The banking sector dominates China's financial sector, but the spill-over effects from the stock market into the banking sector remain containable.

The initial assessment is that the risks are still confined to the securities market.

According to central bank data, equity investment as a stated purpose of loan pledges by commercial banks represents about 6 percent of banks' balance sheets. Mark-to-market losses due to the recent 30 percent drop in the stock market should be limited to within 2 percent of the total bank balance sheet.

The article was compiled by Global Times reporter Li Qiaoyi based on an interview with Dong Dengxin, director of the Finance and Securities Institute at the Wuhan University of Science and Technology, and a research report by Australia and New Zealand Banking Group. bizopinion@globaltimes.com.cn