CHINA will expand investment from Hong Kong and Macau in the mainland stock markets, according to the securities regulator.

The investment from Hong Kong and Macau in the Shanghai and Shenzhen stock markets, especially in the exchange-traded funds there, will be gradually increased, said Guo Shuqing, head of the China Securities Regulatory Commission, at a meeting on Wednesday.

Hong Kong and Macau investment in the mainland stock markets can now only be made via the Qualified Foreign Institutional Investors scheme with limited quotas.

The CBRC will increase the pace to introduce more QFIIs and enlarge their investment quotas, Guo said.

He also noted the CBRC will release rules for the RMB (renminbi) Qualified Foreign Institutional Investors (RQFII), which will let qualified investors raise funds in the currency from the Hong Kong market and invest in domestic A-share and bonds market, as soon as possible.

The RQFIIs will be allowed to invest in mainland securities markets with 20 billion yuan (US$3.15 billion) initially, Vice Premier Li Keqiang said during his Hong Kong visit in August.

The moves may boost China's A-share market in the long run as they will attract more funds to the mainland's capital market.

"We should keep our confidence and seize the opportunities to promote stable and healthy development of the capital market," said Guo.

Chinese stocks fell for the sixth consecutive trading day yesterday with the Shanghai Composite Index down 2.1 percent to end at 2,180.9 points.