HONG KONG (AP) - A survey says Chinese factory activity expanded in August at a slower rate, suggesting the recovery in the world No. 2 economy is losing momentum.

HONG KONG (AP) A survey says Chinese factory activity expanded in August at a slower rate, suggesting the recovery in the world No. 2 economy is losing momentum.

The HSBC preliminary purchasing managers' index fell to a three-month low of 50.3 from 51.7 in July.

The index is based on a 100-point scaled on which numbers below 50 indicate contraction.

China's economy had been showing signs of revival after a slowdown, with growth edging higher to 7.5 percent in the April-June quarter. But the report on the country's vast manufacturing industry shows the recovery is uneven.

Communist leaders in Beijing have already unveiled small-scale stimulus to prop up growth. HSBC economists said "more policy support is needed to consolidate the recovery."

The final version of the survey is due Sep. 1.