Asian stocks did not show a single direction after closing on Tuesday (31). Business in China, however, had a positive tone after the rises in the purchasing managers indices (PMI, its acronym in English) for manufacturing and services in May indicate that the performance of Chinese activity is improving, amid the processes of reopening of businesses. Beijing and Shanghai, after an extensive period of “lockdowns” to contain Covid-19.
The Shanghai Composite stock index rose 1.19% to 3,186.43 points, and the less comprehensive Shenzhen Composite was up 1.57% to 2,006.95 points.
In other Asian markets, Hong Kong’s Hang Seng rose 1.38% to 21,415.20 points, while Taiex rose 1.19% in Taiwan to 16,807.77 points. In South Korea, the Kospi index ended the day with a gain of 0.61%, at 2,685.90 points.
China’s National Bureau of Statistics (NBS) reported that the country’s manufacturing PMI rose to 49.6 in May, while the services PMI rose to 47.8.
Although below the 50-point mark, which indicates expansion of activity, the results gave impetus to the prospect of improvement in the main Asian economy. The expectation is also supported by the plans announced in recent days to reopen some of the main Chinese metropolises, such as Beijing and Shanghai.
“Official PMIs add broader evidence that activity has started to recover as containment measures have been rolled back,” comments Capital Economics. The house, however, warns that “the recovery is likely to remain lukewarm amid weak external demand and tensions in the labor market”.
On a less positive note, Pantheon Macroeconomics assesses that the Chinese PMI could not have come any worse than in April, and levels below 50 points show still declining activity, albeit less pronounced.
The house argues that China’s government policy, including stimulus to the infrastructure sector, seems “insufficient”.
Contrary to the movement of most Asian indices, the Japanese Nikkei closed down 0.33%, at 27,279.80 points. Stocks in real estate companies such as Tokyo Tatemono (-4.19%) and Sumitomo Realty & Development (-3.71%) were among the biggest declines.
In Oceania, the Australian stock market also retreated, down 1.03% from the S&P/ASX 200 in Sydney, to 7,211.20 points.
Source: CNN Brasil
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