China’s Stock-Index Futures Rise After Manufacturing Data

China’s stock-index futures rose after an official government report showed manufacturing expanded faster than estimated last month.

November futures on the CSI 300 Index (SHSZ300) gained 0.4 percent to 2,384.60 as of 9:16 a.m. in Shanghai. China Oilfield Services Ltd. may advance after Credit Suisse Group AG said it preferred the stock among companies in the sector. PetroChina (PTR) Co. may drop after Sanford C. Bernstein & Co. downgraded the Hong Kong-traded shares. China may issue guidelines to deepen reforms of state-owned companies after this month’s Communist Party meeting, the China Securities Journal reported, citing unidentified people.

The Shanghai Composite Index lost 0.9 percent to 2,141.61 yesterday. The gauge slid 1.5 percent in October, taking its annual decline to 5.6 percent. China’s Purchasing Managers’ Index was 51.4 in October, compared with the median estimate of 51.2 in a Bloomberg News survey of 31 economists and 51.1 in September. A number above 50 indicates expansion.

“The manufacturing PMI figure this year has managed to remain above the 50 threshold in every single month, perhaps indicating that the Chinese economy is in better shape than expected,” said Gerry Alfonso, a trader at Shenyin & Wanguo Securities Co. in Shanghai.

The CSI 300 Index fell 1.4 percent to 2,373.72 yesterday, while the Hang Seng China Enterprises Index (HSCEI) dropped 0.1 percent. The Bloomberg China-US Equity Index retreated 0.7 percent in New York yesterday. The Shanghai index trades at 8.5 times projected profits for the next 12 months, lower than the seven-year average of 15.4.

Manufacturing Data

The preliminary reading of a manufacturing purchasing managers’ index from HSBC Holdings Plc and Markit Economics released Oct. 24 was a higher-than-estimated 50.9. The final figure will be released at 9:45 a.m. local time today.

Top leaders of the ruling Communist Party gather next week to set a blueprint for social and economic policies to meet the Communist Party’s goal of doubling per capita income in the decade through 2020. Yu Zhengsheng, ranked fourth in the seven-strong ruling Politburo Standing Committee, said last week that the reforms will be “unprecedented and will promote profound changes in every area of the economy and society.”

China may issue guidelines to deepen reforms of state-owned companies after the meeting, China Securities Journal reported, citing unidentified people. The reforms would involve breaking up SOEs, especially large central government-administered companies, the report said, citing unidentified people. The plenum will run for four days through Nov. 12 in Beijing.

Corruption Probe

Credit Suisse expects anti-corruption investigations to slow down the decision-making process for SOEs, leading to fewer tendering activities in the near-term, analysts led by Horace Tse wrote in a report. China Oilfield has a dominant market share in its sector, they wrote.

PetroChina, the nation’s biggest oil company, was cut to market perform from outperform at Bernstein. Analysts Neil Beveridge and Lu Wang cited a slower-than-anticipated pace of implementation of gas price reforms for the downgrade.

China will cut gasoline and diesel prices by 75 yuan a metric ton starting from today, the National Development and Reform Commission said in a statement on its website.

58.Com Inc., a Craigslist-like Chinese online marketplace, jumped on its first day of trading in New York, while NQ Mobile Inc. rebounded for a third day to pare a monthly slump.

To contact the reporter on this story: Weiyi Lim in Singapore at wlim26@bloomberg.net

To contact the editor responsible for this story: Michael Patterson at mpatterson10@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.