Flash PMI Data Point to Growth

Activity in China's vast manufacturing sector hit a six-month high in September as new orders rebounded, a non-official survey showed on Monday, adding to signs of stabilization in the world's second-largest economy.

HSBC's preliminary Purchasing Managers' Index rose to 51.2 from August's final reading of 50.1, the second consecutive month above the watershed 50 level, which separates expansion from contraction.

The data — the earliest reading of China's economic performance in September — boosted confidence that the government may be able to meet its growth target for the year.

The preliminary survey, conducted by HSBC Holdings Plc and market data vendor Markit Group Ltd, is usually published about a week before the release of the final figures, making it the earliest available indicator of the manufacturing sector's performance.

Major sub gauges, including new orders, output and new export orders, advanced at a faster pace than in the previous month, except for the employment reading, which stood below 50.

"The firmer footing was supported by simultaneous improvements of external and domestic demand conditions," said Qu Hongbin, HSBC's chief economist in China.

"We expect a more sustained recovery as further filtering-through of fine-tuning measures should lift domestic demand. This will create more favorable conditions to push forward reforms, which should in turn boost the mid- and long-term growth outlooks," he said.