On the first day of the rate hike, Shanghai stock index closed at 1320.54 points, down 21.2 points over the previous day. Shenzhen Stock Exchange Market experienced a similar fall.

The People's Bank of China, or the country's central bank, announced Thursday an increase of 0.27 percentage points in both lending and deposit interest rates.

Stockholders were getting a little anxious about the interest rate hike, which is the first of the past nine years. But they appeared to be quite rational over this matter.

"People have talked about the interest rate hike for a long time, we are well prepared psychologically," said a stockholder surnamed Xia.

He predicted that the stock market would return to normal within several days, though the Shanghai stock market showed a drop of 25 points at opening Friday.

The big fall that occurred Friday was only a timely response to the rate rise and would not continue long, Xia believed.

On Friday, the Chinese stock markets fell greatly at first and then began to stabilize. Later, some stocks even began to rise. Meanwhile, many individual stocks rose by more than 4 percent. The turnover in Shanghai and Shenzhen stock markets has no obvious difference from the previous days.

The stock market has been prepared for the interest rate hike, but when it really came, the stockholders could still feel the impact, acknowledged an analyst with China Galaxy Securities Co. Ltd.. What the shareholders worry most is whether the government will raise interest rates further.

China's interest rate rise was necessary and a must for macroeconomic control, said Heng Lin, a noted researcher with the Chinese Academy of Social Sciences.

Tang Min, chief economist with Resident Mission of Asian Development Bank (ADB) in China, said the hike sent a clear signal that it is concerned with the threat of inflation.

Experts predicted this is just the start of another round of macroeconomic controls and the government will continue to raise interest rates until the economic boom is reined in.