Chinese shares rebounded Monday, led by metal producers after weaker July manufacturing data eased concern that the government might tighten credit curbs to keep the economy from overheating.
The benchmark Shanghai Composite Index jumped 35.01 points, or 1.3 percent, to close at 2,672.5, adding to July's 10 percent gain. The Shenzhen Composite Index for China's smaller second exchange rose 2 percent to 1,097.
Investors shrugged off a survey by an industry group that showed manufacturing growth in July dropped to a 17-month low. Some analysts suggested that helped to quell concerns the government might tighten credit curbs.
"The data was pretty much expected by the market, and the economic slowdown is no longer worrying the market. The rising momentum carried on," said Wen Lijun, an analyst for Nanjing Securities.
Metals stocks climbed on higher commodity prices. Tongling Nonferrous Metals Group added 2 percent to 16.72 yuan, while Jiangxi Copper Ltd., China's biggest metal producers, rose 1.6 percent to 29.89 yuan.
Liquor producers rose on expectations a possible uptick in inflation might boost prices paid for their goods. Jiugui Liquor Co. soared 5.9 percent to 15.55 yuan, while Wuliangye Yibin Co., another local liquor maker, surged 5 percent to 29.17 yuan.
Poly Real Estate Group gained 2.5 percent to 13.48 yuan, while China Vanke Ltd., the country's biggest developer edged up 0.4 percent to 8.32 yuan.
In currency markets, the yuan weakened to 6.7745 to the U.S. dollar, down from Friday's close of 6.7734.
