China's services sector expands in September

China's services sector expanded in September, supported by the accelerated growth of new orders, a HSBC report said on Monday.

The HSBC China Services Purchasing Managers' Index picked up to 54.3 last month from 52 in August, due to improved domestic economic conditions despite the contraction in the manufacturing sector, the report said.

A sub-index that shows new order volumes for service companies rose at the highest rate in four months in September, with a reading of 54 compared with 52 in August and 53.5 in July.

According to the report, employment in the services sector continued to increase but at a less aggressive pace. The employment index edged down from a nine-month high of 52.7 in August to 52 in September.

The expansion of the services sector was due to "the earlier easing measures and the stronger consumption demand in the run-up to the Golden week holiday," said Qu Hongbin, HSBC's chief economist for China.

"While this helped to cushion the ongoing slowdown of the manufacturing sector, a meaningful turnaround in domestic demand requires additional easing efforts," Qu said.

The official indicator of the non-manufacturing sector showed a slowdown of the growth rate, which was 53.7 in September, down from 56.3 in August.