China PMIs Beat, CSI 300 Surges 2.4%

Market Snapshot

Asset	Level	Change
Shanghai Composite	4,096.67	+0.56%
CSI 300	4,984.07	+2.38%
Hang Seng	22,881.02	-0.63%
TAIEX	47,221.36	+2.37%
USD/CNY	6.79	-0.05%
USD/HKD	7.84	+0.03%
Copper	6.19	+1.50%
Brent Crude	73.21	+0.08%
Gold	3,990.80	-0.78%
Bitcoin	58,680.15	-2.42%
China 2Y Govt Yield	-	-
China 10Y Govt Yield	-	-

Prior Economic Events

Data	Prior	Cons	Actual
NBS Manufacturing PMI	50	50.10	50.30
NBS Non-Manufacturing PMI	50.10	49.90	50.20

Today's Economic Events

Data	Prior	Cons	Time
RatingDog Manufacturing PMI	-	51.70	17:45
RatingDog Services PMI	-	53.60	17:45

China June NBS Manufacturing PMI rose to 50.3 versus 50.1 consensus, with non-manufacturing at 50.2.
CSI 300 gained 2.38% to 4,984.07 while Shanghai Composite rose 0.56%; Hang Seng fell 0.63%.
PBoC signaled patient policy stance after data beat, keeping focus on liquidity support.

Yesterday's Recap

China’s June NBS Manufacturing PMI printed at 50.3, above the 50.1 consensus and 50.0 prior, while non-manufacturing PMI reached 50.2 against 49.9 expected. The beat was driven by new orders and production, supporting a soft-landing view for the mainland economy. Shanghai Composite closed at 4,096.67, up 0.56%, and CSI 300 jumped 2.38% to 4,984.07 on stimulus hopes.

Hong Kong’s Hang Seng Index declined 0.63% to 22,881.02 amid thin volume in developers. Taiwan’s TAIEX rose 2.37% to 47,221.36, supported by AI-related semiconductor demand. USD/CNY fixed stronger at 6.8109 and closed near 6.79, while USD/HKD held at 7.84.

Copper rose 1.50% to 6.19 on China demand optimism. Export strength lifted the official PMI readings, with analysts noting the surprise upside reflected resilient overseas orders despite ongoing trade tensions with the EU. Property names led mainland gains as investors positioned ahead of the Politburo meeting.

In Hong Kong, developers remained under pressure from weak transaction data and elevated borrowing costs. Taiwan’s advance was concentrated in AI supply-chain names, offsetting broader regional caution. The stronger yuan fix helped anchor sentiment and limited USD/CNY volatility near month-end.

The Day Ahead

RatingDog Manufacturing PMI is scheduled for release at 17:45 ET today, with consensus at 51.7. RatingDog Services PMI follows at the same time, expected at 53.6. Markets will watch for confirmation of the official PMI momentum in mainland China.

No major data releases are listed for Hong Kong or Taiwan. Traders will also monitor any PBoC liquidity operations ahead of month-end. The private survey is expected to corroborate the export-driven improvement seen in the NBS figures.

Any material divergence could shift expectations around near-term policy easing. Month-end funding conditions remain the key focus for money-market desks, with the PBoC likely to conduct fine-tuning operations to keep interbank rates stable.

Other Economic Notes

Mainland property sector saw continued restructuring efforts, with creditor support for onshore bond frameworks reducing contagion risks. <i>↓ p.2</i>

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Other Economic Notes (continued)

Hong Kong’s foreign currency reserves and aggregate balance remained stable, with no HKMA intervention recorded. Taiwan approved further subsidies for advanced chip equipment imports, widening supply-chain divergence with mainland foundries. Broader uncertainty in China’s energy demand forecasting stems from rapid tech sector expansion and structural shifts.

New restrictions on Japanese drone, nuclear and defense-related exports add another layer of complexity to regional supply chains. Hong Kong office landlords, including New World and Ares, cut asking prices by as much as 57% in secondary locations as vacancy rates climb. The World Bank’s decision to phase out new lending to China reflects sustained external pressure and will gradually reduce access to concessional financing for infrastructure projects.

Global Macro News

World Bank announced plans to phase out new lending to China following years of external pressure. Canada’s economy showed a 0.5% GDP gain in April, pointing to a potential Q2 rebound. AI infrastructure spending continues to lift global semiconductor ecosystems, benefiting Taiwan’s export outlook.

Oil prices held near 73.21 as Brent edged up 0.08%. Gold fell 0.78% to 3,990.80 amid stronger risk sentiment. Cross-border yuan clearing initiatives in Africa aim to expand renminbi settlement and reduce dollar reliance.

China appointed Standard Bank and ICBC to run the continent’s first yuan clearing hub, deepening trade settlement in local currency. The move is viewed as a long-term effort to diversify away from dollar dominance in Africa. Semiconductor strength in Korea and Taiwan underscores the global AI capex cycle, though margin pressure from advanced packaging remains a watchpoint.

Greater China Central Banks Watch

PBoC is expected to maintain a patient stance after the PMI beat, with no immediate RRR cut priced in but liquidity kept ample via MLF operations. The stronger yuan fix at 6.8109 reflects efforts to anchor expectations without aggressive intervention. HKMA reported Exchange Fund assets at HK$4.39 trillion in May, with the USD/HKD peg stable and aggregate balance unchanged.

CBC continues to monitor semiconductor export resilience, with May orders up sharply year-on-year, while maintaining focus on FX stability. No rate decisions are imminent across the three central banks. The PBoC’s measured approach leaves room for targeted liquidity support if credit growth disappoints in coming months.

HKMA data confirm ample reserves to defend the peg, while Taiwan’s central bank remains focused on containing imported inflation from energy and tech components.

Greater China Macro Daily(Beta Mode)