Hong Kong’s Hang Seng index jumped on Monday after the release of China’s Caixin PMI. The index jumped 1.10% after ending the previous week lower. Mainland Chinese stocks, Shanghai Composite and Shenzhen Component climbed. Japan’s Nikkei 225 index rose by more than 1.90%. Australia’s ASX 200 index was also in positive territory.
China’s Economic Concerns
The Hang Seng index was positive despite disappointing manufacturing data for July. China’s Caixin Manufacturing Purchasing Managers Index declined to 50.3 down from the previous 51.3. The fall in total new business in July weighed heavily on the index.
The rate of output growth eased for the third consecutive month. Output expanded at the slowest rate in 16 months. Purchasing activity slightly rose in July, the softest increase in four months. The Coronavirus pandemic continued to dampen export sales.
According to the latest survey, inflationary pressures rose, albeit only slightly. Input prices rose at the slowest rate since November 2020. Higher expenses were linked to increased prices for raw materials and transport fees.
Chinese manufacturers were optimistic that output would increase over the next year. However, the level of confidence slipped to a three-month low amid concerns about the Delta coronavirus variant. The current supply chain distribution has also had the manufacturers raise concerns.
Hang Seng Movers
China Resources Land led the gains in the Hang Seng index. China Resources Land is a residential property managers company. The company gained more than 5.58% in its stock earnings.
BYD Company is a Chinese manufacturing company. The company’s stock price advanced by 5.40%. The company recently posted positive earnings for the second quarter. Its quarterly earnings came in at $1.54 per share beating analysts’ estimates.
Country Garden Holdings was also among the top performers in the index. The property development company gained 4.47% as investors seek safety in low-valued stocks.
Among the losers in the index include Country Garden Services. The residential property managers company dipped by 3.09%. China Property Management stocks have been in the red for the past week amid China’s crackdown.
ANTA Sports Products Ltd was also among the laggards. The sports equipment company fell 2.78% after some Republicans started demanding that NBA players server endorsement contracts with Chinese sportswear firms such as ANTA and Li-Ning.