At close of trade, the benchmark Shanghai Composite Index lifted up 0.36%, or 11.61 points, to 3,272.86. The Shenzhen Composite Index, which tracks stocks on China's second exchange, added 0.78%, or 16.47 points, to 2,124.76. The blue-chip CSI300 index climbed up 0.31%, or 12.40 points, to 4,050.93.
China's manufacturing activity beat market expectations in March, despite expanding at a slower pace, official data showed on Friday, while activity in the services sector grew at the fastest pace in nearly 12 years.
The official non-manufacturing Purchasing Managers' Index (PMI) soared to 58.2 in March from 56.3 in February, marking the best level since 2011, according to the National Bureau of Statistics (NBS). The services sector is crucial to China's economy and jobs. It accounts for 55% of GDP and 48% of employment.
The NBS also indicated that the official manufacturing PMI reached 51.9 in March, slightly lower than February's 52.6, but still in expansion territory. The strong PMI data immediately lifted investor sentiment.
The strong PMI figures reinforced Premier Li Qiang's upbeat remarks at a business forum in Boao, Hainan this week. In a keynote speech, the newly minted premier told more than a thousand international business and political leaders that China's economic growth was “strong,” with March's performance even better than January and February's. Consumption and investment picked up and employment and prices were “broadly stable,” he said, adding market expectations improved “notably.”
China has rolled out a number of measures in recent weeks to boost sagging growth and lift business confidence. Earlier this month, the People's Bank of China made a surprise rate cut to keep money flowing through the financial system and prop up the real economy. Around the same time, the commerce ministry announced that for the first time ever, it would launch an “Invest in China Year” in 2023 to welcome foreign companies.
CURRENCY NEWS: China's yuan appreciated against the dollar on Friday, inline with stronger official guidance fixing. Prior to market opening, the People's Bank of China set the midpoint rate CNY=PBOC at 6.8717 per dollar, 169 pips firmer than the previous fix of 6.8886.In the spot market, the yuan CNY=CFXS opened at 6.8550 per dollar and was changing hands at 6.8584 at midday, 126 pips firmer than the previous late session close.
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