Chinese PMI data drags on Asian stocks

|By:, SA News Editor

Asian equities are mixed after preliminary data from HSBC showed that Chinese manufacturing activity contracted for the first time in six months.

"The weak flash PMI will inevitably inflame China slowdown worries, but this is only one data point," says strategist Linus Yip. "If more data start to also show a deeper slowdown, Beijing may be forced to stimulate in order to maintain a stable basis for growth that they need to execute reforms."

However, it was the Hang Seng that seemed to take the brunt of the losses, falling 1.4%, while Australia's S&P/ASX 200 dropped 1.1%.

The Shanghai composite closed -0.5%, with the negative mood perhaps offset by the People's Bank of China conducting 120B yuan ($19.8B) of 21-day reverse-repurchase agreements as it seeks to further defend against a credit crunch.

Elsewhere in Asia, Japan's Nikkei closed -0.8% and India's Sensex is +0.15%.

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