HSBC Holdings, Europe's biggest bank, announced Wednesday that China's Purchasing Managers' Index (PMI) for the manufacturing sector rose to 52.9 in September, one percentage point higher than the PMI of 51.9 reported in August, Shanghai Securities News reported Thursday.

A reading of above 50 percent suggests expansion, while one below 50 percent indicates contraction. Thus, the expansion in China's manufacturing sector continued for a second month, following a decline indicated by July's PMI of 49.4.

The PMI released by the China Federation of Logistics and Purchasing should also rise in September, because while China's economic growth is slowing, the pace of that slowdown is not as fast, the report said, citing Zhang Yongjun, a researcher at the China International Center for Economic and Technical Exchanges.

Zhang also said he believes that the rate of slowing in GDP may decline in the third quarter.