* SSEC +0.1 pct, CSI300 -0.1 pct, HSI flat
* iVX, China's anxiety gauge, jumps to 4-month high
* Stock options trade hits record high
SHANGHAI, May 26 China stocks held steady on
Friday after a tumultuous week, with the Shanghai index holding
above the key 3,000-point level even after Moody's downgraded
the country's sovereign credit rating.
Thursday's surge in index-heavweight financial stocks on
apparent government support, a day after Moody's cut the rating,
continued to support market sentiment, traders said.
But iVX - dubbed China's anxiety gauge - has jumped to a
four-month high, while trading in stock options hit record
volumes, pointing to further volatility ahead.
After jumping more than 1 percent the previous session, both
the blue-chip CSI300 index and the Shanghai Composite
Index were roughly flat by midday, at 3,482.52 points
and 3,110.74 points, respectively.
SSEC fell to as low as 3,022.30 on Wednesday following the
downgrade. The gauge has since rebounded sharply, led by banking
"This is apparently stabilisation effort by the government.
The index has dropped to a very critical level," said Wu Kan,
head of equity trading at investment firm Shanshan Finance,
referring to the 3,000 points - a key psychological level
closely watched by many traders.
"But the state of stability could be temporary."
On Friday, the iVX index, which reflects expectations of
future volatility in the SSE50 index, rose as high as
13.4. The "fear gauge" shot up to 12.35 on Thursday, the highest
closing level in four months.
Also suggesting an increasingly divergent market outlook,
trading in China's stock options almost doubled on Thursday to
1.57 million contracts, the highest on record.
Banking and property shares pulled
back after the previous session's jump, but transportation
stocks were firm.
In Hong Kong, the Hang Seng index was unchanged at
25,637.28 points, while the Hong Kong China Enterprises Index
gained 0.2 percent, to 10,592.10.
(Reporting by Samuel Shen and John Ruwitch; Editing by