Mixed macroeconomic data sizzles Asian Markets

Chinese service economy growth declined straight third month in a row. The Caixin's services Purchasing Manager's Index (PMI) eased to a three-month low of 51.2, from 51.8 in April. Meanwhile, service sector PMI index above 50 indicates expansion while one below indicates contraction. The growth of Chinese economy is still on recovery border line.

The fall of service PMI due to slow business orders, marginal job creation and lower production among manufacturers. Moreover, business optimism slipped to its lowest level so far this year. The SSE Composite index decreased by 0.31 per cent in early trades and the Yuan remained flat at around 6.58 per dollar.

On other hand, Japan's services sector activity expanded in May, rebounding back from a contraction in the previous month because of a modest increase in new orders. The Markit or Nikkei Japan Services Purchasing Managers Index (PMI) rose to 50.4 in May from 49.3 in April on a seasonally adjusted basis. The positive macroeconomic recovery has been seen after month of February i.e. from contraction phase to expansion one.

The index for new business rose to 50.4 from 50.2 in the previous month. On June 1, Prime Minister Shinzo Abe clarified that widely expected decision to delay a scheduled April sales tax increase. The Japanese Prime Minister also promised to restore country’s economy to robust health and win the nation’s long battle with deflation.

The Japanese Nikkei index increased by 0.45 per cent after positive macroeconomic data on intraday basis. Meanwhile, Indian capital markets, BSE Sensex and Nifty 50 increased by 0.53 per cent and 0.44 per cent on intraday basis.