(Sharecast News) - Asia-Pacific equities advanced on Monday, with most major markets in positive territory as investors assessed fresh manufacturing data from China and awaited the Reserve Bank of Australia's policy decision later in the week.
Gains followed a strong close on Wall Street on Friday, where all three major US indexes rose.
Chinese equities in the green despite manufacturing data miss
China's manufacturing activity showed signs of slowing, with the RatingDog general manufacturing purchasing managers' index (PMI) easing to 50.6 in October from 51.2 in September, missing expectations of 50.9 in a Reuters poll.
The figure remained above the 50 threshold that separates growth from contraction, but pointed to softer momentum, particularly in new export orders, which fell at the sharpest rate since May amid renewed US trade tensions.
The private survey results contrasted with the official PMI released Friday, which dropped to 49.0 - its lowest in six months - highlighting the uneven recovery across the sector.
Stephen Innes, managing partner at SPI Asset Management, said the broader market backdrop remained paradoxical despite solid fundamentals.
"It's one of the strangest earnings seasons in years - maybe ever," he said.
"AI has already conquered the stock market, but traders are starting to wonder if the next battlefield might be the bond market.
"The numbers are spectacular, the headlines are euphoric, and yet the market just shrugs.
"This is what it looks like when perfection becomes a burden."
In mainland China, the Shanghai Composite rose 0.55% to 3,976.52, while the Shenzhen Component gained 0.19% to 13,404.06.
Energy and industrial stocks led gains, with Geo-Jade Petroleum climbing 10.13%, China-Singapore Suzhou Industrial Park Development Group up 10.04%, and Wuxi Taiji Industry advancing 10.03%.
The data came after last week's US-China trade truce, which saw Washington halve fentanyl-linked tariffs on Chinese goods to 10% in exchange for Beijing lifting export curbs on rare earths and dropping probes into American chipmakers.
Analysts said the agreement eased near-term uncertainty, with Goldman Sachs upgrading its 2025 GDP forecast for China to 5% amid expectations of stabilising trade and manufacturing growth.
Innes said the market's muted reaction to strong corporate earnings and macro data showed how "the tape's reaction function has become allergic to good news - when everything's already perfect, even 'better' feels redundant."
He added that while liquidity and buybacks continue to provide support, "it's as if the market has climbed so high that the air is thin - traders can breathe, but they can't sprint."
Markets manage gains elsewhere in the region
Elsewhere, Hong Kong's Hang Seng Index advanced 0.97% to 26,158.36, driven by gains in AIA Group, up 5.96%, WH Group, up 4.69%, and Xiaomi, which rose 3.52%.
In South Korea, the Kospi surged 2.78% to a record 4,221.87, with Dic soaring 29.83%, Hyundai Energy Solutions up 28.35%, and Koas adding 28.22%.
Australia's S&P/ASX 200 added 0.15% to 8,894.80 as the Reserve Bank of Australia began its two-day policy meeting.
Economists widely expected the central bank to hold rates steady after a stronger-than-expected inflation reading for the third quarter.
Megaport rose 7.59%, Objective Corp gained 3.41%, and Life360 advanced 3.22%.
New Zealand's S&P/NZX 50 edged up 0.06% to 13,556.30, supported by Westpac Banking Corporation, which climbed 3.77%, SkyCity Entertainment up 2.74%, and Pacific Edge up 2.66%.
Japanese markets were closed for the Culture Day holiday.
Regional currencies mixed, oil prices little changes
In currencies, the yen weakened slightly, with the dollar up 0.09% at JPY 154.13.
The Australian dollar rose 0.05% to AUD 1.5271 to the greenback, while the New Zealand dollar slipped 0.13% to NZD 1.7492.
Oil prices were little changed, with Brent crude futures last down 0.11% on ICE at $64.70, and the NYMEX quote for West Texas Intermediate off 0.16% at $60.88.
Reporting by Josh White for Sharecast.com.
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