March 01, 2023 (MLN): Asian stocks rebounded from a two-month low following data that showed China's manufacturing activity expanded at the fastest pace in more than a decade, boosting investor confidence, as Reuters reported.
The official manufacturing purchasing managers' index (PMI) for China stood at 52.6 in February, compared to 50.1 in January, according to data from the National Bureau of Statistics. This result exceeded expectations, as production increased following the lifting of COVID-19 restrictions late last year.
Non-manufacturing activity in China also grew at a faster pace in February, and data from the Caixin/S&P Global manufacturing PMI indicated a rise in factory activity for the first time in seven months.
As a result, MSCI's broadest index of Asia-Pacific shares outside Japan surged more than 1% to 516.84, after reaching its lowest point since early January earlier in the session.
The boost in Chinese manufacturing activity also helped to lift Chinese stocks, with the blue-chip CSI 300 Index rising more than 1%, while the Shanghai Composite Index increased by about 0.6%.
Hong Kong's Hang Seng Index climbed by 2.67%, and the Hang Seng Tech Index rose by 4%. The Hang Seng Mainland Properties Index surged 3.5%.
Alvin Tan, the head of Asia FX strategy at RBC Capital Markets, noted that the China February PMI data was especially significant because of the typical lack of January/February hard data until later in the month.
The positive manufacturing data helped to ease concerns about rising interest rates, which had been causing anxiety among investors in recent weeks.
