China’s Manufacturing Activity Dips To Lowest Level Since 2009
Sep, 23rd 03:37
The selloff in riskier assets gained pace Wednesday as a preliminary Chinese manufacturing gauge plunged to the lowest level since the depths of the global financial crisis, sending stocks and commodity currencies tumbling and boosting sovereign bonds.
Asian stocks headed for their biggest three-day loss since August’s market rout as Chinese shares slid in Hong Kong and Shanghai. The preliminary Purchasing Managers’ Index from Caixin Media and Markit Economics was at 47.0 for September, the lowest level since March 2009, when global equity markets bottomed after the collapse of Lehman Brothers Holdings Inc. Futures on shares in the U.S. and Japan, where markets are closed Wednesday, also tumbled. Australian bonds surged after the data.
China’s manufacturing gauge, which hasn’t moved above the 50 level that marks the border between expansion and contraction since March, delivered further evidence that the slowdown cited by the Federal Reserve in its decision to hold rates still has further to run. The report comes after four Fed officials have come out saying a 2015 rate increase is still on the radar, saying the U.S. economy is strong enough to withstand transitory volatility from abroad.