The Chinese economy is still growing. Fast. The stock market was overpriced, so there was a selloff. Such things happen. Usually not with so many stocks at once, but its really not unusual. The fundamentals of the Chinese economy are still good, they still have a growing middle class, household debt is very low, and the government is still flush with cash.

Edit - also retail sales are up 10% YoY. GDP up 7% YoY. A bunch of other economic indicators are also good.