China stocks rose on Monday, supported by demand for more speculative small-cap shares, but trading remained thin as investors waited for more clues on the health of the economy.

The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 1.8 per cent to 3,308.25, while the Shanghai Composite Index gained 1.9 per cent to 3,156.54 points.

Small-caps rebounded strongly, with Shenzhen's start-up board ChiNext up 4.7 per cent, and an index tracking tech shares soaring 5.7 per cent.

"Investors seem to be favouring short-term trading in the IT sector with relatively frequent rallies and corrections," wrote Gerry Alfonso, director at Shenwan Hongyuan Securities.

Markets are looking to China's flash factory activity survey on Wednesday for clues on whether the economy is deteriorating more rapidly than earlier thought.

A Reuters poll showed economists expect the flash September China factory PMI headline reading to edge up to 47.5 from a final 47.3 in August, but likely remained near 6-1/2-year lows, pointing to a seventh straight contraction in activity on a monthly basis.

That is likely to add to economists' consensus view that China's economy is in a protracted but gradual slowdown and not facing an imminent hard landing. But any signs of a more marked slowdown could spark fresh selling in global markets.

Most sectors rose at the close, but the CSI300 Banks Index ended down 0.3 per cent.

China National Nuclear Power Co Ltd jumped 5.9 per cent after British finance minister George Osborne said on Monday Britain welcomed the potential for majority Chinese investment in future nuclear projects.

Britain will also provide 2 billion pounds ($3.1 billion) of initial support for a new nuclear power station at Hinkley Point in southwest England, a project China is backing.

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