Asian stocks were seen trading lower on Monday, trimming gains seen in the previous session from the upbeat China data and ahead of the highly anticipated Chinese Community Party meeting scheduled later during the week.
Shares in the Asia-Pacific region began the trading session in green, driven by the sign of rapid growth in China. The official Non-Manufacturing Purchasing Managers Index (PMI) came in at 56.3 in October, advancing to a 14-month high.
The upbeat data had a positive effect on the equities, as stocks in the region dropped later in the session and investors focus on the upcoming key meeting of China’s Communist Party, where members of the party is expected to discuss China’s economic agenda. China’s Communist Party’s upcoming meeting is scheduled from November 9-12, in Beijing.
Meanwhile, the US Federal Reserve’s (Fed) tapering is still in the spotlight, despite the forecasted outcome of the Open Market Committee (FOMC) meeting last week.
Hong Kong’s benchmark Hang Seng was seen flat, edging 0.12% lower to 23,220.00, while the mainland benchmark in Shanghai declined 0.05% lower to 2,147.75 points.
Down from the gains seen from the string of upbeat data’s released on Friday, including the above-forecasted gross domestic product (GDP) growth published in October. The second largest economy grew an annual 7.8% in the third quarter, after China’s growth dropped 7.5% lower in the June quarter.
“China’s Steel PMI in October contracted for two consecutive months, down to 47.5 from 49.2 in September. This does not necessarily contradict with China’s overall PMI expansion in October. In fact, if you look at the detailed breakdown, China’s October overall PMI expansion was fueled by output PMI only, other sub indexes mostly pointed to slowed pace in tapering, especially, new order PMI slowed in October to 52.5 from 52.8 in September,” Helen Lau, senior analyst for UOB Kay Hian, stated in a note.
Kunlun Energy was the session’s main movers, climbing 3.6 higher, while Tingyi Cayman Islands Holding dropped 3%.
HSBC holdings are expected to announce its earnings report for the third-quarter after the market closes later today.
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