- Paul Smith, senior economist at Markit
Japanese manufacturing activity contracted at its fastest pace in 18 months in October, due to a decline in exports and weak domestic demand. Nation's Manufacturing Purchasing Managers Index (PMI) tumbled to a seasonally adjusted 46.9 in October, down from 48.0 in September. A reading above 50 indicates industry expansion, while any reading below indicates contraction.
"Latest survey data are consistent with manufacturing production contracting at a quarterly rate of just over 3 percent," said Paul Smith, senior economist at Markit. "Sub-par industry performance continues to be closely linked with underlying export weakness."
"The continuation of the soft patch that has been evident in the second half of the year in 2012 so far has also now spilt over into the labour market. Manufacturers cut jobs for the first time in six months during October – and at the sharpest pace since mid 2009."
The Nikkei 225 Stock Average surged 0.21%, or 18.58 points, to 8,946.87. The broader Topix Index advanced 0.13% , or 0.99 points, to 743.32.
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