"This is still the December reading, so we're closing out 2013 on a softer note in China," said Frederic Neumann, managing director and co-head of Asian Economics Research at HSBC.
"The biggest surprise here is the weak new export order reading with new orders contracting. We had the Korea PMI out earlier as well, which also showed contracting export orders so the trade cycle isn't firing on all cylinders," he added.
The HSBC data follows the release of the official PMI on Wednesday which dipped to 51.0 in December from 51.4 in November and came in below analysts' expectations.
The HSBC survey is weighted towards smaller and private companies, while the official China PMI has larger and state-owned companies.
(Read more: Four big challenges for Asia in 2014: HSBC)
Asian stock markets were little changed following the data, while the Australian dollar rose 0.2 percent to around 0.8898 per U.S. dollar.
China is Australia's main trading partner, so the Aussie dollar tends to be sensitive to economic news from China.
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