Some growth stabilisation expected in China's official manufacturing PMI

The China flash Caixin manufacturing PMI disappointingly dropped further to 47 in September from 47.3 the previous month. Gauges of output, new orders and employment all decreased at faster rates. This report suggests growth momentum in the manufacturing sector continued to weaken. 

"We expect the official manufacturing PMI to remain unchanged below 50, although favourable seasonal factors may offset some of the weakness", says Societe Generale.

That said, other indicators paint a less gloomy picture. The Baidu SME barometers for manufacturing sectors continued to improve for the second consecutive month in September. Domestic prices for most commodities did not drop further. 

"We are still looking for signs of growth stabilisation near term", added Societe Generale.