The preliminary reading for the HSBC Purchasing Managers' Index slumped to a nine-month low in August, indicating further contraction of China's manufacturing activities.

The HSBC Flash PMI, the earliest available indicator of China's industrial sector and which is slanted more towards private and export-oriented firms, fell to 47.8 in August from July's final reading of 49.3, the bank said this morning.

A reading under 50 means contraction.

Qu Hongbin, chief economist for China at HSBC, said falling orders dragged down the August Flash PMI to the nine-month low.

"It indicates that Chinese producers are still struggling with strong global headwinds," Qu said. "China must step up policy easing to lift infrastructure investment in the coming months if it hopes to achieve the stated goal of stabilizing growth and the jobs market."

China's gross domestic product expanded 7.6 percent from a year earlier in the second quarter, the slowest pace in three years but close to the government target of a minimum 7.5 percent growth for this year.