China's factory activity turned in its best performance in five months in May, a private survey showed on Thursday, raising hopes that recovery in the world's second-biggest economy is gaining traction.
The flash Markit/HSBC Purchasing Managers' Index (PMI) came in at 49.7, better than the 48.1 final reading in April, but still shy of the 50-mark that demarcates expansion from contraction.
The news prompted a gains across major share markets across Asia, with the Nikkei rising more than 2 percent. The Australian dollar, typically sensitive to Chinese data due to the huge trade links between the two countries, surged around quarter of a U.S. cent, rising to as high as $0.9273.
A breakdown of the data showed improvements across various indices. New export orders, a proxy for foreign demand, showed the biggest jump, climbing 3.4 points to 52.7, its highest level in more than three years.