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China’s stock index climbs out of 4-month low after June’s factory data beat forecasts

  • The CSI 300 Index, which tracks the biggest companies listed in Shanghai and Shenzhen, gained 0.5 per cent on Monday, adding to the 0.2 per cent gain on Friday

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Investors at a securities company in Fuyang, in China’s eastern Anhui province on August 28, 2023. Photo: AFP
Jiaxing Li
Chinese stocks climbed from a four-month low after privately compiled data showed that factory activity in June had beaten expectations and expanded to a three-year high.

The CSI 300 Index, which tracks the biggest companies listed in Shanghai and Shenzhen, gained 0.5 per cent on Monday, adding to the 0.2 per cent gain on Friday. Hong Kong’s financial markets were closed for a holiday.

Other key Asian markets were mixed. Japan’s Nikkei 225 added 0.1 per cent, and South Korea’s Kospi added 0.2 per cent, while Australia’s S&P/ASX 200 dropped 0.2 per cent.

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A private report released on Monday pointed to a better-than-expected expansion in China’s factory activity. The Caixin/S&P Global manufacturing purchasing managers’ index (PMI) rose to 51.8 in June from 51.7 in the previous month, marking the fastest clip since May 2021 and surpassing analysts’ forecasts of 51.2.
The upbeat data helped alleviate concerns following the official PMI data, which stood at 49.5 in June and was unchanged from May, according to data released by the National Bureau of Statistics (NBS) on Sunday. A reading above 50 indicates expansion of activity, while a reading below suggests contraction.
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Shares of property developers advanced in mainland China, amid optimism that an upbeat economic climate would encourage buyers to return to the real estate market. Poly Developments jumped 6.2 per cent to 9.31 yuan and China Vanke rallied 5.2 per cent to 7.29 yuan, leading gains among developers. The chip designer Cambricon Technologies rallied 3.1 per cent to 204.84 yuan, Zijin Mining climbed 2.7 per cent to 18.04 yuan, while electronics product producer Foxconn Industrial Internet jumped 2.2 per cent to 28 yuan.

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