China’s Manufacturing Rebounds, Asia Stocks Surge


Asia-Pacific Markets Soar on Manufacturing Expansion, Led by China’s Private Survey Jump

Shanghai Stock Exchange

China’s Brighter Manufacturing Outlook Boosts Sentiment

Asia-Pacific stock markets painted a vibrant green on Monday as investors welcomed news of China’s manufacturing sector showing promising signs of expansion. A private survey, known as the Caixin Purchasing Managers’ Index (PMI), painted an optimistic picture of the country’s manufacturing activity, which has been a crucial barometer of its economic health.

According to the Caixin survey, the PMI climbed to 51.7 in May from 51.4 in April, marking its fastest growth rate since June 2022 and surpassing market expectations. Notably, this survey data offered a more positive outlook than Friday’s official data, which had indicated a slight contraction in the sector.

Buoyed by this encouraging news, Hong Kong’s Hang Seng Index surged 2%, injecting enthusiasm into the regional markets. Mainland China’s CSI 300 Index also shifted gears, turning positive to climb by 0.22%.

Positive Sentiment Extends to India

Beyond China, market participants eagerly awaited the outcome of exit polls in India, where Prime Minister Narendra Modi seeks to extend his party’s rule for a remarkable third consecutive term. Encouraging predictions suggest that Modi’s Bharatiya Janata Party alliance may indeed achieve this rare feat.

Regional Upbeat Sentiment

Japan joined the positive trend with its benchmark Nikkei 225 Index advancing by approximately 1%, while the broader Topix Index gained 0.86%. Australia’s S&P/ASX 200 Index followed suit, rising by 0.72%.

South Korea’s Kospi Index posted an even more robust increase of 1.80%, with its smaller-cap counterpart, the Kosdaq, also climbing by 0.26%.

Cautious Calm on Wall Street

In contrast to the energetic surge in Asia-Pacific markets, Wall Street futures remained subdued ahead of the first trading day of June. Dow Jones Industrial Average futures edged up by a modest 25 points, or less than 0.1%, while S&P 500 futures remained relatively flat. Nasdaq 100 futures dipped slightly by 0.1%.

However, this caution did not overshadow the impressive performance of May, with all three major Wall Street indexes closing with positive monthly results for the sixth time out of the last seven months. The Nasdaq Composite, in particular, boasted a remarkable 6.9% increase, making it its best month since November 2023.

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