Shares in Asian countries such as China and Japan rallied higher on Monday due to a better than expected factory data report as well as the current optimism of the global market regarding the economy.
The Nikkei 225 index edged 0.2% to 20,400.78 on Monday. The recent quarterly survey from the bank of Japan showed that the economy of the country is improving. The report revealed rising shortages in factory capacity that would drive companies to increase their investments, therefore, helping economic growth rise higher.
Shares in the country such as Mitsubishi and Yokohama logged gains of around two to three percent. However, shares of Nissan Motors slipped by 2.7% due to reports of the automobile maker failing the final inspections of completed vehicles. The company is suspected of violating law from the Ministry of Land, Infrastructure, Transport, and Tourism regarding checks being done by their employees.
Other survey reports also showed a bright outlook for manufacturing data with the possibility of their output rising as demand and orders continue to rise up. Despite the optimistic outlook, some markets did not react positively due to the ongoing geopolitical concerns between North Korea and the United states as well as the snap elections scheduled this coming October 22.
In China, factory activity also grew during the month of September following a robust manufacturing activity since the last five years. The official manufacturing purchasing managers’ index rose to 52.4 during the last month from 51.7 back in August.
This also happened to be the highest number since April 2012. This was due to the country’s manufacturing sector increasing their activity as they strive to meet growing demand. According to the Federation of Logistics & Purchasing, production and new export orders along with the total orders rising at a fast rate.
Most Asian stocks which closed higher during Monday’s session were positive due to the upbeat manufacturing data in China that eased concerns regarding the political meeting that would take place in the coming months.
Other reports also revealed a rise in export numbers in South Korea due to the growth in memory chip and steel product sales.
The global market was mostly positive last week due to the U.S. Federal Reserve’s announcement of another possible interest rate hike before the end of the year, an outlook which was perceived by the markets to be impossible more than a month ago. Stocks in the United States also rallied with the Nasdaq composite ending on an all-time high rallying by 0.7% to 6,495.96.
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