Asian indexes lifted by strong China manufacturing report

Stocks indexes in Asia were mostly higher yesterday after surveys showed China’s factory activity rose to a two-year high last month, suggesting the world’s No. 2 economy is stabilizing.

KEEPING SCORE: Hong Kong’s Hang Seng index jumped 1.3 percent to 23,237.93 and the Shanghai Composite index added 0.2 percent to 3,106.74. South Korea’s Kospi was a smidgen higher at 2,008.55. Japan’s Nikkei 225 edged 0.2 percent lower to 17,399.30 and the S&P ASX/200 of Australia lost 0.6 percent to 5,286.60. Shares in Southeast Asia were mostly higher.

CHINA DATA: Caixin’S monthly purchasing managers’ index rose to 51.2 in October from 50.1 the previous month as production grew at its fastest in more than five years on strong domestic demand. A similar index by the official Chinese Federation of Logistics & Purchasing rose to 51.2 from 50.4 in September. Both are at their highest level since July 2014. They are based on 100-point scales on which the 50 mark separates expansion from contraction.

ANALYST VIEWPOINT: “Overall, today’s data are unambiguously upbeat and consistent with broader evidence that the economy is currently in the midst of a cyclical recovery. Given the continued feed through from earlier policy easing, we expect activity to hold up well until early next year,” Julian Evans-Pritchard of Capital Economics said in a commentary.

U.S. TRADING: Market players are cautiously watching day-to-day developments of the U.S. presidential campaign, with just over a week to the election. The Dow Jones industrial average lost 0.1 percent to 18,142.42. The Standard & Poor’s 500 index was down less than 0.1 percent at 2,126.15 and the Nasdaq composite also lost less than 0.1 percent, to 5,189.13.

THIS WEEK: Also overhanging the markets are a Federal Reserve policy meeting and the October jobs report. Fed policymakers are not expected to raise interest rates so close to the election. However, investors are watching for comments on the economy. The jobs report will be the last major piece of economic data out before the Nov. 8 election. It’s also a busy week for corporate earnings, with more than one-fifth of S&P 500 companies reporting their quarterly results.

JAPAN: The Bank of Japan wrapped up a two-day policy meeting without any changes to its minus 0.1 policy rate or other moves. The central bank did downgrade its inflation outlook, saying it expects to achieve a 1.5 percent inflation rate, rather than 1.7 percent, in the fiscal year that begins in April. The inflation rate now is about zero. Recent manufacturing data have shown a slight uptick in production that economists say could signal the stagnant economy is gaining strength.

ENERGY: U.S. benchmark oil futures gained 10 cents to $46.96 a barrel in electronic trading on the New York Mercantile Exchange. Overnight they extended their losses after falling last week to their lowest price this month. Crude fell $1.84 to $46.86 a barrel in New York. Brent crude, the international standard, rose 31 cents to $48.92 a barrel.

CURRENCIES: The U.S. dollar inched higher to 104.91 yen from 104.87 yen a day earlier. The euro slipped to $1.0964 from $1.0973. Kelvin Chan, Hong Kong , AP