Asia Trader

Asian Markets Trade Lower on Monday as Investors React to China’s November PMI Data

Stocks in Asia-Pacific fell in Monday trade as investors digested the release of China’s official manufacturing Purchasing Managers’ Index (PMI) for November.

China’s National Bureau of Statistics announced Monday that the official manufacturing PMI for November was at 52.1. That was above expectations for a 51.5 reading forecast by analysts in a Reuters poll.

PMI readings above 50 signify expansion while those below that level represent contraction. PMI readings are sequential and show month-on-month expansion or contraction.

Monday’s data release represented the ninth straight month of expansion for Chinese manufacturing recovery as the country continues to see a strong bounce from the coronavirus pandemic.

Mainland Chinese stocks shed earlier gains to slip on the day: The Shanghai composite declined 0.49% to approximately 3,391.76 while the Shenzhen component dipped 0.152% to around 13,670.11.

Hong Kong’s Hang Seng index dropped more than 1.5%, as of its final hour of trading.

Trade frictions between Washington and Beijing may also have weighed on investor sentiment on Monday.

Reuters reported, citing sources, that the Trump administration is set to add China’s top chipmaker SMIC and oil and gas producer CNOOC to a defense blacklist. Shares of CNOOC in Hong Kong last plunged 12.91% while SMIC declined more than 3%.

Markets elsewhere in the region were also lower. In Japan, the Nikkei 225 declined 0.79% to close at 26,433.62 while the Topix index fell 1.77% to finish its trading day at 1,754.92. Still, the Nikkei 225 saw its best month since January 1994, according to FactSet.

Japan’s retail sales rose 6.4% year-on-year in October, according to a preliminary report by the country’s Ministry of Economy, Trade and Industry. The data was in line with a median market forecast, according to Reuters.

South Korea’s Kospi fell 1.6% to close at 2,591.34.

Meanwhile, shares in Australia edged lower, as the S&P/ASX 200 declined 1.26% on the day to 6,517.80. Treasury Wine Estates saw its stock plunge nearly 7% after the firm announced Monday it would reallocate some wine intended for China and reduce costs following Beijing’s imposition of tariffs on Australian wine.

MSCI’s broadest index of Asia-Pacific shares outside Japan declined 1.3%.

Markets in India were closed on Monday for a holiday.

Oil prices declined in the afternoon of Asia trading hours, with international benchmark Brent crude futures down about 2% to $47.20 per barrel. U.S. crude futures also shed 1.87% to $44.68 per barrel.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 91.715 after following a decline in recent days from levels above 92.

The Japanese yen traded at 103.97 per dollar after strengthening from levels above 104.4 against the greenback last week. The Australian dollar changed hands at $0.7379, having risen from levels below $0.732 in the previous week.