China Everbright Securities Co, the country's fifth-largest brokerage by market value, said a "system error" occurred on Friday morning, at a time China's benchmark Shanghai Composite Index experienced an abnormal surge.

The benchmark SCI gained by 5.6 percent in two minutes on Friday morning. Trade volume also grew 80 percent more than the 30-day average.

Earlier media reports said the volume of an order was accidentally multiplied by a trader. Other sources said simulated trading was connected to real operations in error. The cause has not yet been confirmed.

The Shanghai Composite Index dropped by 0.6 percent at close on Friday. Trade volume was 123.1 billion yuan ($20 billion), up from 84.7 billion yuan on Thursday.