Asian stocks rise, Shanghai Composite stuck at key hurdle

  • Asian stocks are reporting gains as China factory data unexpectedly bettered estimates. 
  • Shanghai Composite faced rejection at a key hurdle despite upbeat data. 

Asian stocks are flashing green on better-than-expected China factory data.

At press time, Japan's Nikkei index is adding 1% or 262 points and is the best performing major Asian equity index. Shares in Australia, South Korea, and Hong Kong are also flashing green.

Meanwhile, the Shanghai Composite is trading at 2,881, representing a 0.32% or nine-point gain on the day. The index faced rejection at the former support-turned-resistance of 2892 (Oct. 9 low) earlier today.

Factory activity in China unexpectedly returned to growth, the official data released on Friday showed.

The purchasing managers' index (PMI) for China's manufacturing sector rose to 50.2 in November from 49.3 in October, marking the first above-50 reading in 13 months, the National Bureau of Statistics (NBS) said Saturday.

The Caixin PMI, which focuses on the small and medium-sized export-oriented units, rose to 51.8 in November from October's 51.7 to register the fastest expansion in three years.

While the economic data has been good, the news flow on the US-China trade front has been slightly negative. Beijing's top priority in any "phase one" trade deal with the United States is the removal of existing tariffs on Chinese goods, China's Global Times newspaper reported on Sunday.

However, the US is reportedly not willing to roll back tariffs, as the officials believe tariffs are their only weapon in the trade war and giving up that weapon meant "surrender." In fact, the US is poised to impose an additional 15% tariff on about $156 billion of Chinese products on Dec. 15.

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