Analysts gloomy despite stocks' 1.8% rally

Stock analysts remained gloomy about Chinese equities despite a substantial rally on Thursday that extended gains for a second day.

The Shanghai Composite Index advanced 1.8 percent - 35.27 points - to 2,029.07, as an index showed Chinese manufacturing activities continued to expand in July.

Lianyungang Huanghai Machinery Co Ltd, a heavy machinery maker, jumped by the daily trading limit of 10 percent to 19.21 yuan. China Vanke Co Ltd, the country's biggest residential developer by market share, grew 2.31 percent to 9.74 yuan. China Petroleum & Chemical Corp, also known as Sinopec, gained 1.14 percent to 4.43 yuan.