China has launched its own version of a "stock market stabilization fund" as the country's central bank vowed to provide funding support for the Central Huijin Investment Ltd to increase holdings in the A-share market, analysts said.

On Tuesday, the People's Bank of China, the country's central bank, said it firmly supports Central Huijin's efforts to increase its holdings of stock market index funds and will provide sufficient re-lending support to Central Huijin when necessary to resolutely maintain the steady operation of the capital market.

This came after Central Huijin, an arm of China's sovereign wealth fund, provided liquidity to the A-share market during the slump on Monday by increasing its holdings in exchange-traded funds while vowing to further increase its exposure.

Also on Thursday, the National Financial Regulatory Administration said it has allowed more equity asset allocation by insurance funds. 

Gao Ruidong, chief economist of Everbright Securities, said that at a critical moment when China's A-share market is facing external disruptions such as tariff policies, Central Huijin's timely increase in holdings demonstrates the authorities' commitment to stabilizing financial markets.

"In this sense, it can be seen as a 'Chinese version of a stabilization fund'," Gao said.