China's non-manufacturing activities rebounded in June after weakening for two straight months, a survey showed yesterday.

The official non-manufacturing Purchasing Managers' Index, which measures the performance of companies in the service industry, rose to 56.7 in June, up from May's 55.2 and April's 56.1, the National Bureau of Statistics said. A reading above 50 indicates expansion.

The growth was bolstered by increased activity in industries such as logistics, telecommunications and broadcasting, while less vitality was reported in the retailing, hospitality and road transport sectors, the bureau said.

"It is encouraging that China's service companies can deliver better performance compared with a month earlier while the overall economy still has many uncertainties," said Li Maoyu, an analyst at Changjiang Securities Co. "Growing new business contributes the most to the pick-up of service activities, and it can help to reduce the fears of a sharp economic slowdown."

Component indices showed new business orders increased 1.2 points from a month earlier to 53.7 in June, reflecting more demand for services.

Coupled with manufacturing PMI results last month which were better than expected, analysts say China's economy is stabilizing.

The official Purchasing Managers' Index, a composite indicator of operating conditions in the manufacturing sector, was 50.2 last month, down from May's 50.4 but still in expansion.

China's gross domestic product grew 8.1 percent from a year earlier in the first quarter, the slowest in nearly three years. Some economists estimated the growth rate would tumble to 7.5 percent in the second quarter.

The National Bureau of Statistics is set to unveil key economic data, including second-quarter GDP, inflation, industrial output, retail sales and investment, next week.

Lu Zhengwei, an economist at Industrial Bank, said China's economy may have bottomed out, and the government needed to introduce a set of "mild" policies to stimulate growth. He suggested lowering interest rates one more time to make it easier for companies to get loans.

China has stepped up efforts of late to sustain growth, including one interest rate cut in May and various fiscal stimuli.

The country is aiming for a balance between excessive stimuli and an insufficiency, in a bid not to repeat the mistakes in the 2008 package which led to high inflation and overproduction.