China’s Manufacturing PMI Rose: Is the Economy Back on Track?
China’s manufacturing PMI in September
The September China manufacturing PMI (Purchasing Managers’ Index) report indicates a strong rise in manufacturing activity compared to August 2017. It was 52.4 in September 2017 compared to 51.7 in August 2017. It was well above the market expectation of 51.5.
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Let’s look at some of the key factors in China’s manufacturing PMI:
- Production volume and output showed strong improvement in September 2017. It rose to 54.7 compared to 54.1 in August 2017.
- New order growth showed solid improvement in September. It rose to 54.8 compared to 53.1 in August. Export orders also improved at a stronger rate in September.
- Employment in the manufacturing sector showed weaker improvement in September.
Consumer buying activity also improved in September 2017. The buying activity index rose to 53.8 in September compared to 52.9 in August. Improvement in domestic demand and international demand (ACWI) (VTI) mainly drove the manufacturing PMI in September.
Performance of major ETFs in September
The iShares MSCI China (MCHI), which tracks the performance of China (ASHR) (FXI), rose 1.5% in September 2017. The SPDR S&P 500 ETF (SPY), which tracks the performance of the S&P 500 Index (IVV) (VOO), rose 2.0% in September 2017.
In the next part of this series, we’ll analyze the performance of China’s services PMI in September 2017.