China stocks fell sharply on Monday before recovering much of their losses as regulators cracked down on speculators which Beijing blames for a 40% crash in the country's stock markets since June. The main Shanghai Composite Index fell 3% Monday morning, before recovering some of its losses to close 0.8% lower. However, that still left it more than 12% down for the month of August, following a drop of more than 14% in July.