The SSE 50 Index of some of the country’s largest stocks fell 0.5% at the close, paring an earlier slide of 2.3%. Financial shares eked out gains. The Shanghai Composite Index fell 2.5% in the morning before paring the loss to 0.9%. Hong Kong’s equities market was closed for the holiday.

Chinese shares slid in the morning along with equities in Japan, where the Nikkei 225 Stock Average fell into a bear market. The losses were triggered by the S&P 500 Index suffering its worst final session before the Christmas holiday on record.

“The gains by big banks and insurers suggest state buying, and some funds may also be bottom-fishing stocks,” said Dai Ming, a Shanghai-based fund manager with Hengsheng Asset Management Co.

Kang Chongli, a Beijing-based strategist with Lianxun Securities Co., said the 2,500 level “is both a policy and technical bottom” for the Shanghai Composite Index. The gauge ended the day at 2,504.82.

China’s “national team” of state-backed funds is frequently suspected of buying shares during turbulent times. Large caps like banks are among the most favoured targets, and buying often comes in the afternoon so gains, or at least smaller losses, are locked in for the day. The funds were net buyers of bank stocks in the third quarter, UBS Securities Co. said in November.

China’s stock benchmark is down 24% this year, in line for the worst performance in a decade, as a trade dispute with the US escalated.

Agricultural Bank of China Ltd added 0.9% on Tuesday, erasing a drop of 0.6%. Bank of China Ltd. rose 0.6%, and Bank of Communications Co. rose 0.4%. China Southern Airlines Co. rose 1.9% as the best performer on the SSE 50 measure, erasing a slide of 1% in the morning.

A sub-gauge of energy stocks was the worst performer among the CSI 300 Index’s 10 industry groups, falling 2.1% as crude fell to the lowest level in a year and a half. China Petroleum & Chemical Corp. and PetroChina Co. lost at least 2%.