China’s non-manufacturing industries rebounded from the slowest expansion in at least 19 months according to data released yesterday, adding to manufacturing gains that confirm that China is recovering from a slowdown that lasted seven-quarters.
The purchasing managers index rose to 55.5 in October (from 53.7 the previous month). This growth follows two reports last week that showed a pickup in manufacturing industries.
We further expect that China will still roll out mild stimulus measures in some sectors as it completes a once-a-decade power transfer this week. The nation’s central bank said the economy is expected to maintain “steady and relatively rapid growth”.
This data confirms our macro view that now is the time to be buying Hong Kong listed stocks with China exposure.
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