Australian shares reversed an early dip to rise 0.3 percent on Tuesday as a better-than-expected manufacturing survey from China showed modest expansion, raising hopes of an economic recovery in Australia’s largest export market, though a drop among miners tempered gains.
A preliminary HSBC/Markit Flash China Purchasing Managers’ Index rose to 50.5 in September from August’s final reading of 50.2. The 50 point level separates growth in activity from contraction. This helped buoy the market, with Australia’s largest telecommunications provider Telstra Corporation Ltd gaining 1.1 percent, while diversified company Wesfarmers Ltd added 0.4 percent.
“The PMI data was much stronger than expected, that’ll keep the bears (away)- we’re seeing a relief rally across most risk assets at the moment,” said Ben Le Brun, a market analyst from OptionsXpress. The S&P/ASX 200 index rose 16.4 points to 5,379.3 by 0204 GMT. The benchmark declined 1.3 percent on Monday, its biggest one-day loss since early August.