Stocks in Asia traded higher on Tuesday despite China’s factory activity falling into contraction for the first time since April.
According to the Caixin survey compiled by S&P Global, the purchasing managers index came in at 49.2 in July, which was lower than 50.3 expected by economists in a Reuters poll.
In the morning session, Japan’s Nikkei rose 0.74%, Hong Kong’s HSI gained 0.13%, Korea’s KOSPI jumped 1.17% and Australia’s ASX200 increased 0.33% while China’s SSEC dropped 0.12%.
The Caixin survey came one day after the official report from the Chinese state agency that factory activity continued to contract for the fourth straight month in July as the country is struggling to boost its sales amid weak global demand.
The manufacturing purchasing managers’ index for July came in at 49.3, slightly better than 49.0 in June, 48.8 in May and 49.2 in April but still in negative territory, according to the official release by the National Bureau of Statistics on Monday. The reading in July was slightly better than the 49.2 median polled by Reuters.
Meanwhile, non-manufacturing PMI for July was at 51.5, the weakest reading this year compared to 53.2 in June, 54.5 in May and 56.4 in April.
