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China stocks rise as private survey shows growth in factory activity

China stocks rise as private survey shows growth in factory activity

Stock markets of mainland China and other Asia-Pacific nations have reportedly witnessed an upward trend after a private survey in China indicated slight growth in the country’s factory activity.

The readings by China’s official Purchasing Managers’ Index, which was released on Sunday, projected a contraction in factory activity.

However, the Caixin/Markit manufacturing Purchasing Managers’ Index read 50.4 for July, lower than the predicted 51.5 in a Reuters poll. The reading, however stood at 51.7 in June.

Venkateswaran Lavanya, Economist at the Mizuho Bank, said that the drop in the official manufacturing PMI from 50.2 last month to 49.0 this month showcases the degree of growth uncertainty amid the rising Covid-19 case in the country, which will result in restricted global demand and risks in the property market.

Lavanya added that a rough start to Q3 puts increases the risk of China missing its GDP growth target of around 5.5% this year. This came after the authorities pointed toward granting no big stimulus and maintaining its zero-Covid policy last week.

Meanwhile, Japan’s Topix index grew 1.02%, at 1,960.11, and Nikkei rose 0.69%, hitting 27,993.35. Australia’s S&P/ASX 200 index also advanced 0.69%, reaching 6,993, and South Korea’s Kosdaq rose 0.48%. Kospi, however, remained flat.

Hong Kong’s Hang Seng index suffered the most losses, remaining mainly flat as internet major Alibaba dropped 3.11% after registering a decline of over 5% earlier in the trading session.

The firm’s U.S.-listed shares also fell 11% in the regular trading session after the U.S. added it to the list of firms at delisting risk under the Holding Foreign Companies Accountable Act.

On the other hand, banking major HSBC saw a 3.24% rise in Hong Kong-listed shares during the afternoon trading session.

This follows the bank announcing a $1.7 billion decrease in its pre-tax profit for the first half of this year, which came at $9.2 billion, according to its interim results media release. Still, it raised its expected return on tangible equity from 2023, from 10% in February to 12%.

Source credit: https://www.cnbc.com/2022/08/01/asia-markets-caixin-manufacturing-pmi-china-currencies-oil.html

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Meghna Singh

An English Literature graduate, Meghna Singh ventured into the profession of content development to incorporate her knack for writing articles across verticals including technology, healthcare, business, and alike for News Origins and RunningAfrica. She has also completed her MBA in Tourism and worked as a content creator in the field of product development.