A Chinese manufacturing index rose to the highest in 16 months in August as new orders jumped, adding to evidence that growth in the world's second-largest economy is strengthening after a two-quarter slowdown.
The purchasing managers' index was at 51.0, the National Bureau of Statistics and China Federation of Logistics and Purchasing said on Sunday in Beijing. That compared with July's 50.3. Readings above 50 indicate expansion.
The report bolsters confidence the economy is responding to Premier Li Keqiang's policies to support growth amid a crackdown on shadow banking aimed at curbing financial risks.
"It's becoming more clear that the economy is stabilising," Zhang Liqun, a researcher with the Development Research Centre, an agency advising China's cabinet, said in a statement.
The Shanghai Composite Index rose 2 per cent last week, the biggest gain since March. The latest PMI figure is the highest since April 2012.
A sub-index of new orders jumped to 52.4 from 50.6 the previous month, a gauge of new export orders rose above the 50 line that divides expansion from contraction for the first time since March, and an output reading rose to 52.6 from 52.4.
The preliminary reading of a separate manufacturing index released by HSBC and Markit Economics late last month showed the first expansion since April.
The Chinese government in March set a 2013 growth goal of 7.5 per cent and has a target for an average 7 per cent expansion through 2015. GDP increased 7.5 per cent in the April-to-June period from a year earlier, down from 7.7 per cent in the first quarter, extending the longest streak of sub-8 per cent expansion in at least two decades.