Chinese shares up on factory survey

CHINA, Apr 1: Chinese shares continued to rise after a government survey indicated that factory activity had picked up unexpectedly in March.

The latest Purchasing Managers’ Index (PMI) rose to 50.1, up from February’s 49.9 and higher than market forecasts.

A reading above 50 points shows an expansion in activity in the sector, while one below indicates contraction.

The mainland Shanghai Composite index rose 1.4% to 3,801.2, while Hong Kong’s Hang Seng was up 0.6% at 25,055.

However, while the official PMI survey suggested activity had expanded, a private survey indicated it had contracted, in line with preliminary figures released earlier this month.

The final HSBC/Markit PMI came in at 49.6, slightly higher than a “flash” reading of 49.2.

China has cut interest rates twice since November, among other measures, to try to boost activity.

More economic data

Japanese shares were lower after a survey of big manufacturers showed that while confidence held steady in the first quarter, it is expected to worsen.

The Bank of Japan’s quarterly Tankan showed that big firms plan to cut spending by 1.2% in the fiscal year that starts in April – a worrying sign for the economy.

The benchmark Nikkei 225 index closed down 0.9% at 19,034.84.

A survey also suggested that Japanese manufacturing activity expanded more slowly in March than in the previous month as domestic orders contracted for the first time in nearly a year.

The final Markit/JMMA PMI was 50.3, just below the preliminary reading of 50.4 and below 51.6 in February.

Commodities weigh

In Australia, the S&P/ASX 200 closed down 0.5% at 5,860.8, with shares hit by persistently weak commodity prices

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Oil prices fell for a third consecutive session on Tuesday, while Chinese iron ore futures tumbled nearly 4% to a record low.

South Korean shares were down after a private survey indicated that manufacturing activity and new export orders contracted in March.

The benchmark Kospi index ended down 0.6% at 2,028.45.

The HSBC/Markit PMI fell to 49.2, down from a 20-month high of 51.1 that was seen in both January and February.

BBC