Data published on 1 April showed China’s manufacturing activity expanded at the fastest pace in over a year in March.
The Caixin/S&P Global manufacturing purchasing managers index rose to 51.1 in March from 50.9 in February. This was above consensus forecasts and marks a fifth consecutive month of expansion.
The 50-point level separates growth from contraction.
The measures for new orders and export orders, considered to be good leading indicators, are now back to levels last seen in early 2023, when there were expectations of a strong reopening after Covid-Zero restrictions were lifted.
Chinese stock markets reacted positively to the news with the CSI 300 index, the main benchmark for mainland-quoted stocks, up 1.65% on 1 April. Since the start of 2024 investors have been awaiting stimulus measures to improve sentiment toward Chinese stocks. This better-than-expected economic news may trigger a turning point, particularly if it is followed by further policy stimulus.
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