Despite a recent bevy of troubling corporate earnings reports in China (leading to a counterintuitive gain for China stocks — go figure) there are some indications that things might be on the mend. The all-important residential housing sector saw a slight uptick in sales during the first two months of the year, recording a 1.1% yearly increase for the period. Not huge 2007-style gains, but pretty decent compared to the 20.3% decline in housing sales seen in all of 2008. Furthermore, property consultancy SouFun also said housing transactions in major cities have been rising over the past few weeks. On the other side of the see-saw, it appears that hopes that manufacturing had already bottomed out earlier this year may have been a bit too optimistic. The CLSA purchasing manager’s index (PMI) for March indicated further contraction in the manufacturing sector, falling to 44.8 from 45.1 in February. To those who predicted a turnaround for manufacturing this year we say — not so fast. Also on the hold-your-horses front, China has extended the lock-up period on stake sales in its state-run banks. The head of the China Banking Regulatory Commission said that future foreign investors in Chinese banks will have to accept a five year lock-up period as opposed to the current three-year period.