HONG KONG, Nov. 2 (Reuters) – China COSCO Holdings, the country's largest shipping group, narrowed its quarterly losses as China demand drove a rise in bulk cargo volume and freight rates and the container shipping market improved.

China COSCO made a net loss of 690.7 million yuan ($101.2 million) in the quarter ended Sept. 30, cutting its quarterly deficit by nearly half from 1.27 billion yuan in the second quarter, based on Chinese accounting standards.

The worst of the global shipping slump is over but shipper's earnings outlook remains uncertain, say analysts -- severe oversupply remains and G3 consumption is recovering slowly.

The carrier, which operates container ships and commands the world's biggest bulk cargo fleet, earned 5.56 billion yuan in the same quarter last year.

China COSCO's turnover fell 52 percent to 15.8 billion yuan in the third quarter, it said in a statement late on Thursday.

Domestic rivals China Shipping Container Lines (CSCL) and China Shipping Development disappointed the market earlier this week with quarterly results that showed no signs of market recovery, analysts said.

''China COSCO posted third quarter losses marginally worse than our expectations, mainly due to the severity of the container shipping losses worse than our expectations, largely offset by China COSCO's other operations performing better than our expectations,'' Sophie Loh, an analyst at Morgan Stanley said in a research report on Friday.

CSCL, which vies with China COSCO for the world's No. 6 container shipping firm position, lost 1.94 billion yuan ($284.1 million) in the third quarter. China Shipping Development, a bulk cargo carrier that ships raw materials such as iron ore and coal, saw its quarterly net profit dive 81 percent from a year ago.