China shows signs of manufacturing recovering

Results from a HSBC (HBC.NYSE, 0005.HKG, HSBA.LON) manufacturing index signaled an increase in Chinese factory orders, a sign that the industrial sector is stabilizing after two years of sluggish growth, Financial Times reported. The bank’s flash China manufacturing purchasing managers’ index (PMI), an early reflection of the health of factory orders, rose to 49.1 this month from 47.9 in September. The reading means that growth in Chinese manufacturing is still slowing but is more buoyant than last month. Analysts said that the results, released Wednesday, make a future increase in government stimulus less likely. “The better October flash PMI and September data paint a consistent picture of a likely further pick-up in economic activity on the back of more accommodative monetary conditions, increasing infrastructure investment, recovering property market activity and improved external demand,” said Jian Chiang, Barclay’s China economist.