Shanghai SSE Composite soars on optimistic HSBC PMI

The Shanghai SSE Composite Index has soared following the release of the HSBC Flash China Manufacturing Purchasing Managers' Index (PMI), which showed operating conditions continued to improve in December.

Released today (December 14th), the closely-watched PMI's flash estimates indicate that this month's reading rose to 50.9 from November's 50.5, which is a 14-month high.

The PMI system works in such a way that readings higher than the benchmark of 50 indicate expansion within that sector, while those lower than this mean contraction.

Although the HSBC PMI is not the official government report, it is still closely watched by economists, as it is deemed to offer a broad view of the entire economy – which is the world's second-largest.

Chief economist at HSBC Hongbin Qu commented: "[The PMI] confirmed that China's ongoing growth recovery is gaining momentum mainly driven by domestic demand conditions."

When the markets closed in Shanghai earlier, the SSE Composite made impressive gains of more than four per cent to an index value of 2150.6 points.

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