BEIJING, April 20 -- Chinese stocks ended down on Monday, with the number of transactions reaching an all time high after a reserve requirement ratio (RRR) cut and new short-selling measures.

The benchmark Shanghai Composite Index closed down 1.64 percent, or 70.22 points, to finish at 4,217.08 points, while the Shenzhen Component Index dipped 1.96 percent, or 277.74 points, to close at 13,871.6 points.

During Monday's trading, losers outnumbered gainers by 675 to 255 in Shanghai and by 1,051 to 329 in Shenzhen.

Combined turnover for the two bourses rose to a record 1.8 trillion yuan (294.22 billion U.S. dollars), with transactions of shares listed on the Shanghai bourse reaching an all time high at 1.1476 trillion yuan during Monday's trading session, according to the Shanghai Stock Exchange.

The record high figure caused trouble to the bourse's "show2003.dbf" system which could not display a transaction figure more than that, the Shanghai bourse explained in an urgent notice to customers.

However, the transactions were not disturbed by the software flaw.

To address the flaw, the Shanghai bourse said it will replace the "show2003.dbf" system step by step by a comparatively new system called "FAST".

The ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, dropped 1.59 percent, or 39.14 points, to end at 2,424.85 points.

The Hushen 300 Index, which samples about a fifth of the total stocks listed on the two bourses, slipped 1.61 percent, or 74.22 points, to close at 4,521.92 points.

Chinese stocks experienced a roller coaster-like trading day on Monday as shares were bullish in the morning trading session and bearish in the afternoon session.

The Shanghai Component Index rose 1.6 percent to hit a seven-year record high of 4,356 points at 13:21 p.m. before it retreated all the way to 4,217.08 points at the daily close.

The Shenzhen Component Index reversed its lower opening and climbed nearly one percent to a daily high of 14,288.33 before it collapsed at the same time with the Shanghai bourse during afternoon session.

Transportation, agriculture and communication sectors witnessed robust performances while health care, securities and insurance industries suffered huge losses.

Analysts said Sunday's RRR cut, which came into effect on Monday, and newly released short-selling measures were behind the record high transactions as the important news had multiple interpretations.

The People's Bank of China on Sunday lowered the RRR for all banks by 100 basis points to 18.5 percent. This is the second reduction this year and the largest since November 2008.

The RRR cut added more liquidity by reducing the amount of cash that banks must hold as reserves.

Analysts say the RRR cut was expected as economic indicators, including industrial output and retail sales, showed slowing growth and triggered concern.

However, the cut was bigger than expected and could free up to 1.5 trillion yuan (244.88 billion U.S. dollars) into the real economy.

Xu Gao, an analyst with Everbright Securities, narrowed this to 1.3 trillion yuan in his forecast.

Analysts say performance was also influenced by the securities regulator's clarification of new short-selling measures.

China's securities regulators said on Friday that fund managers would be allowed to lend shares for short-selling after mainland markets had closed, the number of stocks investors can short sell would also be increased.

This should promote a balanced development of margin trading rather than suppress the stock market, said China Securities Regulatory Commission (CSRC) spokesperson Deng Ke on Saturday.

In the past five years, margin buying experienced rapid development, while short selling with borrowed stocks saw much slower growth, according to a notice issued by the Shanghai and Shenzhen bourses and two industry associations.

Short selling by borrowing stocks is a mature mechanism commonly seen overseas, which can reduce fluctuations, discover reasonable prices and hedge against market risks, said Deng, adding that these measures were outlined in a 2014 guideline on promoting the healthy development of the capital market.