Stocks in Shanghai soared higher Monday on further indications of a developing Chinese economy, while Southeast Asian markets surrender some of the advances they reached after the U.S. Federal Reserve’s decision to leave stimulus unaltered. HSBC's preliminary reading on Chinese manufacturing for September spiked to 51.2 compared with a final score of 50.1 in August. A score above 50 on the purchasing managers index signifies boosting factory activity, while a score under 50 points to a contraction. The Shanghai Composite zoomed 0.9% up, the Australian dollar climbed as high as 94.37 U.S. cents, while Australia’s S&P ASX 200 pared some of its earlier pullbacks — last down 0.5%. This early sign is the newest in a string of economic data in recent weeks that points to a recovery in Asia’s biggest economy, picking itself from weakness earlier in the summer and supporting Chinese stocks: The Hang Seng China Enterprises Index is climbed 9.6% so far this month. Last week’s surprise decision by the U.S. Federal Reserve to leave its bond-purchasing program unaltered supported some markets that were closed late last week, after they came online after a series of public holidays. South Korea’s Kospi recorded a 0.4% increase, coming online after last week’s public holiday. Shanghai was also exchanging for the first time since the Fed decision. But markets that had already had a chance to react to the Fed decision took their lead from Wall Street, which failed to hold on to its gains from earlier in the week as the central bank continued to dominate attention. On Friday, St Louis Fed President James Bullard stated that the central bank could make a small stimulus trim at its next meeting in October. Indonesia’s JSX plunged 1.1%, Singapore’s Strait Times Index relinquished 0.6%, and the Philippines’ PSE Composite was 0.3% down. Some of Asia’s biggest markets were closed Monday however, with Japan shut for a public holiday, while Hong Kong cancelled its morning session after Typhoon Usagi hit the city. The yen powered up to ¥99.11 versus the dollar in Asia, compared with ¥99.33 late Friday in New York. Preliminary results that Germany has re-elected Angela Merkel as chancellor on Sunday gave the euro an initial boost early in Asia that quickly faded as the day progressed. The single currency rose as high as $1.3553, compared with $1.3526 late Friday in New York, and was last at $1.3527.
