Asia close: Chinese stocks lag behind after soft factory survey data

by | Aug 1, 2023

(Sharecast News) – Stocks across the Asia Pacific region put in a mixed showing on Tuesday following the release of soft economic data.
Japan’s Nikkei-225 rose by 0.92% to 33,476.58, while South Korea’s Kospi added 1.31% to 2,667.07 and Taiwan’s Taiex was up 0.39% to 17,212.87.

Shanghai Stock Exchange’s Composite Index ended the day roughly flat at 3,290.95, while Hong Kong’s Hang Seng index dipped 0.34% to 20,011.12.

The Greenback was stronger alongside, putting on 0.51% to 143.01 against the yen, while versus the yuan it advanced 0.34% to 7.1668.

Overnight, survey compiler Caixin published its factory sector Purchasing Managers’ Index for the month of July.

The PMI printed at 49.2, down from 50.5 for June and the consensus forecast for a reading of 50.1.

“Global demand is likely to be weak in H2, as the U.S. is likely to enter a mild recession, while the Eurozone is already soft,” said Duncan Wrigley at Pantheon Macroeconomics.

“The Politburo has signalled that China will refrain from major demand stimulus in H2 […] This limited policy support means that China’s recovery probably will continue to be “tortuous”, uneven and drawn out.”

Rival PMIs out in Japan and South Korea edged up from 49.4 to 49.6 and from 47.8 to 49.4.

But being below the 50 point level both still pointed to a contraction in the sector.

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