China's stock rally could extend another 15% to 20%, Goldman Sachs says. China's equity indexes have jumped dramatically since Beijing announced major stimulus policies. Goldman highlighted still low valuations and diminishing risk as tailwinds for a continued rally.

The recent two-week rally sparked by the unveiling of the People’s Bank of China’s stimulus package has already seen one of the sharpest increases in Chinese equities in history. Goldman Sachs’ analysts said the rally could now have more legs.