Asia report: Markets rise as China manufacturing PMI beats forecasts

Most markets in Asia finished in positive territory on Monday, as investors digested the latest economic data from China, which showed further expansion for its industrial sector.

In Japan, the Nikkei 225 was up 1.39% at 23,295.48, as the yen weakened 0.09% against the dollar to last trade at JPY 104.75.

Automation specialist Fanuc was up 0.91%, while among the benchmark’s other major components, fashion firm Fast Retailing lost 0.17% and technology conglomerate SoftBank Group was off 1.43%.

The broader Topix index was ahead 1.81% by the end of trading in Tokyo, closing at 1,607.95.

On the mainland, the Shanghai Composite eked out gains of 0.02% to 3,225.12, and the smaller, technology-heavy Shenzhen Composite was 1.15% firmer at 2,223.39.

The unofficial Caixin/Markit manufacturing purchasing managers’ index showed an expansion for the sector in China for the sixth month in a row, coming in at 53.6 for October.

That was higher than the 53.0 picked by analysts in a poll for Reuters, and above the 50-point mark that separates expansion from contraction.

The private survey came after Beijing’s official PMI on the sector came in at 51.4 for the month, down slightly from the 51.5 it recorded in September.

South Korea’s Kospi advanced 1.46% to 2,300.16, while the Hang Seng Index in Hong Kong was 1.46% higher at 24,460.01.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics up 1.41%, while SK Hynix was 0.38% weaker.

Developments in the ongoing Covid-19 pandemic were also closely watched during the Asian session, after UK prime minister Boris Johnson announced on Saturday night that England would go into a second national lockdown from 5 November, for an initial period of four weeks.

At the same time, the US beat its record for daily new cases once again, with 99,321 new infections reported on Friday, according to Johns Hopkins University.

“Markets in Asia have seen a largely positive session despite the prospect of further restrictions across the whole of Europe in the lead-up to Christmas,” said CMC Markets chief market analyst Michael Hewson.

“A better-than-expected China manufacturing PMI number for October of 53.6, its best level in nearly 10 years, points to the fact that the world’s second biggest economy has continued to gain traction as it slowly returns to some kind of normal after its February lockdown.”

Oil prices were lower at the end of the Asian day, with Brent crude last down 2.24% at $37.09 per barrel, and West Texas Intermediate falling 2.68% to $34.83.

In Australia, the S&P/ASX 200 ended its trading session 0.4% higher at 5,951.30, while across the Tasman Sea, New Zealand’s S&P/NZX 50 was the odd one out in the region, slipping 0.11% to 12,070.83.

The down under dollars were both stronger on the greenback, with the Aussie last ahead 0.09% at AUD 1.4222, and the Kiwi advancing 0.12% to NZD 1.5101.