July 3 (Bloomberg) — China’s stocks fluctuated as energy producers gained on speculation power demand is recovering, while metals producers fell.

Datang International Power Generation Co. jumped 4 percent after the China Securities Journal said the nation’s electricity output gained in June, its first monthly advance since October. Jiangxi Copper Co. retreated 2.9 percent as a report showing U.S. employers cut more jobs than forecast in June dragged down commodities prices.

The Shanghai Composite Index fell 3.61, or 0.1 percent, to 3,056.64 as of 10:07 a.m., after changing direction at least four times. It’s up 4.4 percent this week as a government survey showed manufacturing expanded for a fourth month in June. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, declined 0.3 percent to 3,274.21.

“The U.S. jobs report raises the question about whether China’s recovery can be sustained, given that hope of bolstering growth through external demand in the second half looks slim,” said Li Jun, a strategist at Central China Securities Holdings Co. in Shanghai.

The Shanghai index has rebounded 68 percent in 2009, the world’s second-best performer, on evidence a 4 trillion yuan ($585 billion) stimulus plan and record lending is reviving the economy. The gauge lost 65 percent last year as the global recession curbed demand for the country’s exports. China is the world’s second-largest exporter.

Shares on the gauge trade at 29.6 times earnings, the most expensive since March 2008, weekly data compiled by Bloomberg show.

Power Demand

Datang International gained 4.1 percent to 8.61 yuan. China Shenhua Energy Co., the nation’s largest coal producer, climbed 2.8 percent to 32.70 yuan. Pingdingshan Tianan Coal Mining Co., the listed unit of China’s fifth-largest producer, gained 2.7 percent to 31.06 yuan.

China’s electricity output gained 3.6 percent in June, the China Securities Journal reported today, citing China State Grid Corp. Power output at the end of June rose 7 percent from a year earlier as warm weather increased demand for electricity, it said. Liu Xinfang, a State Grid press official, didn’t immediately answer calls to his office today seeking comment.

The news follows a report by the state-run Xinhua News Agency that power demand in the nation’s manufacturing hub of Guangdong rose in June.

Jiangxi Copper slid 1.7 percent to 32.89 yuan. Western Mining Co., China’s fourth-largest maker of zinc concentrate, dropped 1.6 percent to 15.24 yuan.