S.Korea Oct mfg PMI hits 5-mth high on expansion-HSBC/Markit
SEOUL, Nov 1 (Reuters) - South Korean manufacturing activity expanded in October for the first time in five months as export orders picked up, a private sector survey showed, suggesting the economy continues to recover despite an unexpected output decline in September.
The HSBC/Markit purchasing managers' index (PMI) of South Korea's manufacturing sector rose to a seasonally adjusted 50.2 in October from 49.7 in September, Markit Economics said, marking the highest reading since May.
This was also the first time that the index rose above the 50 mark separating growth from contraction in five months, bolstering expectations for the manufacturing sector to regain its footing in the current month following a surprise fall in output over September.
In October, the sub-index for new export orders surged to a seasonally adjusted 53.7, marking a 31-month high as well as the first time the index has risen above 50 since May 2013.
"This shows that Korea remains on track for a gradual recovery as it heads towards year-end, especially with orders picking up on the external front," HSBC economist Ronald Man said in a statement. "But there is still scope for demand from China to rise further, which would provide a further boost to Korean shipments."
South Korea's manufacturing activity closely mirrors exports, as the country is home to some of the world's largest producers of cars, ships and smartphones.
(Reporting by Se Young Lee; Editing by Eric Meijer)