SHANGHAI stocks recovered from yesterday's fall as emerging industries gained amid higher expectation for China's economic transformation.

The key Shanghai Composite Index added 12.87 points, or 0.57 percent, to 2,288.53 points. Daily turnover was 92 billion yuan (US$15.1 billion). The index edged up 0.25 percent, extending four weeks of gains.

"The A-share market is expected to fluctuate in the short term due to mixed signals," China Galaxy Securities Co said today.

"Blue chips are under pressure from economic downturn and financial turbulence in peripheral markets," the broker said. "But the government effort to speed up economic transformation and ample market liquidity continue to shore up confidence."

Analysts said economic transformation will focus on optimizing China's industrial structure and increasing the proportion of emerging industries that will bring opportunities to related sectors.

Medical equipment producers led the winners. China Resources Wandong Medical Equipment Co jumped 7 percent to 12.56 yuan. Top Choice Medical Investment Co climbed 5.1 percent to 27.03 yuan. Shinva Medical Instrument Co rose 2.4 percent to 40.14 yuan.

Beijing Zhongchuang Telecom Test Co surged by the daily limit of 10 percent to 8.77 yuan. Eastern Communications Co, a manufacturer of mobile communications equipment, gained 5.2 percent to 5.65 yuan.