By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Hong Kong stocks jumped to lead most Asian equity markets higher Monday after manufacturing data on China signaled an improvement in the world’s second-largest economy.
The benchmark Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +2.89% ended 2% higher to clinch a third straight trading day of gains, Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK +0.66% rose 1.4% and Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +1.08% added 1%.
China’s Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.23% itself ended flat after moving in both directions, while South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +0.98% dropped 0.1% at the end of a choppy session.
The broad advances came after official Chinese data released over the weekend showed the manufacturing Purchasing Managers’ Index for August rose to 51.0 from 50.3 in July. The final reading of a separately conducted survey by HSBC and Markit, released Monday, also put the August PMI reading at 50.1 — above the 50-point level that signals an expansion — rebounding strongly from an 11-month low of 47.7 in July.
“The rise in the official manufacturing PMI for August suggests that cyclical improvement in industry continued in August. It likely reflects a consolidation of the improvement in export momentum and the first impact of some measures taken recently to support growth,” said Louis Kuijs, a China economist at the Royal Bank of Scotland.
HSBC China chief economist Hongbin Qu also offered similar views, adding that while recent stimulus measures and restocking activities at companies led to the improvement in August, the bank expected “some upside surprises to China’s growth in the coming months.”
The gains in Asia follow a drop on Wall Street Friday, and amid lingering worries the U.S. may lead a military intervention in Syria, even as President Barack Obama is seeking congressional support for such a move. U.S. stock markets will be closed Monday for Labor Day holiday.
Obama: Ready to act against Syria, but will seek authorization
President Obama said he is in favor of taking military action against Syria for the alleged use of chemical weapons against its own people, but that he will seek authorization from Congress before moving forward.
Leading stock gains in Hong Kong, China Shenhua Energy Co. /zigman2/quotes/206065610/delayed HK:1088 +1.15% /zigman2/quotes/206839995/delayed CSUAY +1.05% jumped 5%, Sands China Ltd. /zigman2/quotes/207609245/delayed HK:1928 +2.45% /zigman2/quotes/201078396/delayed SCHYY -0.80% climbed 4.3% and heavyweight China Construction Bank Corp. /zigman2/quotes/208974133/delayed HK:939 +2.29% /zigman2/quotes/207732534/delayed CICHY +1.10% advanced 2.5%.
China Railway Construction Corp. /zigman2/quotes/210155888/delayed HK:1186 +0.58% jumped 3.4% and China Railway Group Ltd. /zigman2/quotes/205101114/delayed HK:390 +1.47% /zigman2/quotes/206114870/delayed CRWOF +4.69% gained 0.5% after each posted a more than 45% jump in first-half profits.
The Shanghai-listed shares of China Railway Construction /zigman2/quotes/202453937/delayed CN:601186 +0.49% and China Railway Group /zigman2/quotes/200210795/delayed CN:601390 +1.76% rose 3% and 0.7%, respectively.
Shares of Aluminum Corp. of China, or Chalco /zigman2/quotes/202960704/delayed HK:2600 +0.29% /zigman2/quotes/208051344/composite ACH -1.63% /zigman2/quotes/210453246/delayed CN:601600 0.00% , gained 1.9% in Hong Kong and 0.3% in Shanghai despite a loss at the company in the first half of 2013.
The advance in Tokyo came as the U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.0094% climbed back above the ¥99-level, providing a lift to several internationally exposed corporations.
Pharmaceutical major Daiichi Sankyo Co. /zigman2/quotes/207030186/delayed JP:4568 -1.79% /zigman2/quotes/208524651/delayed DSKYF -2.86% added 3.3%, Japan Tobacco Inc. /zigman2/quotes/208255672/delayed JP:2914 -0.85% /zigman2/quotes/208949046/delayed JAPAF +0.51% gained 1.7% and Isuzu Motors Ltd. /zigman2/quotes/202637468/delayed JP:7202 -1.26% /zigman2/quotes/206362374/delayed ISUZY -1.41% advanced 2.2%.
Meanwhile, major miners advanced in Sydney after the Chinese PMI data.
Rio Tinto Ltd. /zigman2/quotes/200083756/delayed AU:RIO +2.36% /zigman2/quotes/202627887/composite RIO +1.47% rose 1.6% and Fortescue Metals Group Ltd. /zigman2/quotes/202351558/delayed AU:FMG -1.66% /zigman2/quotes/204116626/delayed FSUMF +0.99% climbed 2.4%, although gold miners underperformed after the precious metal’s prices dropped under the $1,400-an-ounce level.
Shares of Westpac Banking Corp. /zigman2/quotes/203084975/delayed AU:WBC +0.79% advanced 1.4% and National Australia Bank Ltd. /zigman2/quotes/210431826/delayed AU:NAB +0.35% /zigman2/quotes/208329321/delayed NABZY +1.40% gained 1.2% ahead of an expected decision on Tuesday by Australia’s central bank rate to hold the benchmark interest rate at 2.5%.
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