Manufacturing Activity in October and Stocks in Asia

It was an interesting day, as stocks in Asia-Pacific saw gains on the day, as China’s manufacturing activity grew in October. Let’s have a look at the stocks to learn more about the situation. 

Interestingly, mainland Chinese stocks strengthened their positions on the day. The Shanghai Composite was slightly higher at around 3’225.12. At the same time, the Shenzhen Component added 1’393% to about 13’420.96. 

Hong Kong’s Hang Seng index gained around 1.4% as of its final hour of trading.

Moreover, Japanese stocks saw gains on the day, the Nikkei 225 advanced 1.39% to end its trading day at 23’295.48. In the meantime, the Topix index soared 1.81% to 1’607.95.

South Korea’s Kospi index added 1.46% to 2’300.16. 

Australia’s S&P/ASX 200 gained 0.4% to end its trading day at 5’951.30. 

Stocks and economic data

As stated above, China’s manufacturing activity grew in October. Investors closely watched the information that came from the world’s second-largest economy. According to the private survey, China’s manufacturing sector expanded for the sixth month in a row. 

It is worth mentioning that, the Caixin/Markit Purchasing Managers’ Index (PMI) for Chinese manufacturing came in at 53.6 in October. Interestingly, this result surpassed expectations. Importantly, PMI readings above 50 signify, while the result below 50 indicates a contraction. Importantly, PMI readings are sequential and represent on-month expansion or contraction. 

According to the country’s National Bureau of Statistics, China’s official manufacturing PMI for October came in at 51.4. This result was slightly lower than in September.

Let’s get back to the stocks in Asia-Pacific on Monday, as stated above stocks across the region saw gains on the day. 

It is hard not to mention the coronavirus pandemic and its impact on investor sentiment. On Saturday, the U.K.’s Prime Minister Boris Johnson made an important announcement Saturday. According to this announcement, England will adopt a second national lockdown starting Thursday. It makes sense, as the government is working hard to cope with the coronavirus pandemic. 

Moreover, the U.S. is also trying to cope with the recent spike in infections. It is worth mentioning that, the country has the highest number of infections in the world. This fact once more underlines the impact of the coronavirus pandemic on the world’s largest economy. 

Also, the situation not only in the U.S. and the U.K. but in other countries particularly in Europe remains quite complicated. It is hard to determine, how long it would take to cope with the coronavirus pandemic in Europe.