SHANGHAI - Stocks on the Chinese mainland rebounded from the lowest close in almost four months. The advance came as investors speculated that recent declines were excessive, and the nation's biggest mutual fund boosted its holdings in real-estate companies.

A gauge of property developers rallied the most in two weeks and Poly Real Estate Group Co rose 3.45 percent. Goldman Sachs Group Inc also upgraded the industry, which has led losses over the past year amid concern that China's central bank will boost borrowing costs to curb inflation. CSR Corp climbed 2.25 percent after the Securities Daily said the train manufacturer will sign an agreement with General Electric Co. China Citic Bank Corp gained the most in two weeks after profit rose.

"The rally probably reflects speculation that there won't be any interest-rate increase this weekend," said Li Jun, strategist at Central China Securities Holdings Co in Shanghai. "The longer the central bank delays over rate hikes, the greater the volatility in the market."