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Better Chinese manufacturing lifts shares

Dec 03 2012 07:49 AFP

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Bangkok - Asian stock markets rose on Monday after surveys showed a recovery in China's manufacturing gained momentum in November.

HSBC's Purchasing Managers' Index rose to 50.5 in November on a 100-point scale on which numbers above 50 indicate activity is expanding. It was the first expansion in 13 months. The reading in October was 49.5.

That comes on top of the release Saturday of a state-sanctioned survey, the China Federation of Logistics & Purchasing's monthly Purchasing Managers' Index, which showed an improvement to 50.6 from 50.2 in October.

The PMI index measures overall manufacturing activity by surveying numerous indicators including orders, employment and actual production.

Japan's Nikkei 225 index rose 0.7% to 9,508.26. Hong Kong's Hang Seng index added 0.2% to 22,067.07. South Korea's Kospi gained 0.3% to 1,938.93. Benchmarks in Singapore, Taiwan and Indonesia rose. Mainland Chinese shares fell marginally.

The Chinese numbers are rare good news for the world economy, which has slowed as Europe's chronic debt crisis worsened and the American economy stagnated.

"This confirms that Chinese economy continues to recover gradually," said Hongbin Qu, chief economist for China research at HSBC.

On Friday, US stocks ended nearly flat amid ongoing budget negotiations in Washington. The Dow Jones industrial average rose less than 0.1% to close at 13,025.58. The Standard & Poor's 500 index rose marginally to close at 1,416.18. The Nasdaq composite fell nearly 0.1% to 3,010.24.

Wall Street stocks have fluctuated between gains and losses in recent days as investors followed the latest headlines from the budget negotiations. Lawmakers need to reach a deal to avoid drastic tax increases and government spending cuts that could throw the US back into recession.

Benchmark oil for January delivery was up 26 cents to $89.17 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 84 cents to close at $88.91 in New York on Friday.

In currencies, the euro rose to $1.3040 from $1.3002 Friday in New York. The dollar fell to ¥82.33 from ¥82.50.

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