VENTURES AFRICA – The JSE All Share Index (ALSI) on Thursday struck a new record high during early trade, touching an all-time high of 37 811.23 points from a previous record of 37 749.90 points.
The rock-hard manufacturing data from the US and China ignited positivity that global economic growth might be recovering.
Chinese manufacturing activity is on track to expand this month for the first time in more than a year.
This is according to preliminary results of a key business survey released this morning, adding to evidence pointing to a growth pick up during the fourth quarter.
HSBC, UK’s third biggest bank with emerging market focus, said the preliminary or “flash” reading of its China manufacturing Purchasing Managers’ Index (PMI) rose to 50.4 on a 100-point scale, above the 50-point threshold that separates improvement from deterioration.
This marked the first time in 13 months the index had topped the 50 mark. In October, the final reading of the HSBC China manufacturing PMI came in at 49.5. The final version of the HSBC is slated for December.
Economists said the preliminary survey supported the view of an improving mainland Chinese economy. Many economists may revise their forecasts higher for the official government-sponsored PMI.
“It shows that the policy easing has continued to support a growth recovery, and reinforces our view that growth will pick up strongly in the fourth quarter to 8.4 percent from 7.4 percent in the third quarter,” one economist said.
Among the PMI’s subcomponents, measures of output and new export orders both increased, reversing direction from October’s reading.
Société Générale called the details of the report “encouraging,” noting that output was at its highest level since October last year, while new exports orders hit a two-year high.