BEIJING, Oct 24 (Reuters) - Activity in China’s giant manufacturing sector picked up in October, a preliminary survey showed on Thursday, buoyed by strong new orders and suggesting the economy may have stabilised even though a strong rebound remains elusive.
The flash Markit/HSBC Purchasing Managers Index (PMI) stood at 50.9 in October, above September’s final reading of 50.2 and marking a seven-month high.
New orders rose to 51.6, the highest in seven months and well above the 50 line separating expansion from contraction.
The flash PMI figure, the earliest reading of China’s monthly economic performance, offers some positive news after recent disappointing export figures and the previous month’s manufacturing PMI, which had shown weak domestic demand.
China’s economy grew at its quickest pace this year between July and September, but many economists see growth slowing ahead as global demand remains soft and as Beijing moves to restructure the economy towards one driven more by consumer demand than investment and credit.
The government has repeatedly stated it will accept slower growth during the restructuring, but policymakers have also shown a willingness to step in to keep growth stable.
The flash PMI showed new export orders ticked up only marginally, suggesting a stabilising in global demand but no solid rebound.
Actual exports had registered a surprise 0.3 percent year- on-year drop in September, as fears of a tapering in U.S. monetary stimulus weighed on demand from Southeast Asian economies.