Asian markets shrug off Chinese manufacturing data

 
Guy Bentley
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Asian markets are relatively flat after Chinese manufacturing data came in line with expectations but still showed the sector in contractionary territory.

Markit's manufacturing purchasing managers' index (PMI) rebounded, from 48 in March to 48.3 in April, exactly in line with Bloomberg's median forecast.

The pick-up was primarily due to rebounds in the output and new orders components.

While the data may suggest that China's 7.5 per cent GDP growth target may be overly optimistic, London-based consultancy Capital Economics believe the latest PMI numbers signal the downward pressure on the world's second largest economy has eased.

Last week Chinese Premier Li Keqiang said the government is not considering a strong stimulus package to counter the economic slowdown. However, Capital Economics think the continued slowdown likely to be seen this quarter will be moderated by government support for railways and social housing.

The Australian dollar fell to a two-week low after figures from the Australian Bureau of Statistics showed CPI inflation rose 2.9 per cent in the year to March, below analysts expectations of 3.2 per cent.

Japan's Nikkei is up 0.6 per cent, while the the Topix has risen by 0.5 per cent so far. The Hong Kong Hang Seng Index has retreated 0.7 per cent, with the Shanghai Stock Exchange also seeing losses of 0.4 per cent. South Korea's Kospi is down 0.1 per cent.