China's manufacturing activity hits 4-month high

China's manufacturing activity hit a four-month high in August due to a rebound in new orders, preliminary results of a business survey by Markit Economics and HSBC Ltd., showed Thursday. The HSBC final China Manufacturing Purchasing Managers Index (PMI), a gauge of nationwide manufacturing activity, rose to 50.1 percent in August, up from July's final reading of 47.7 percent. The PMI marked the strongest growth since May 2011 and the fourth straight month-on-month expansion. A PMI reading above 50 percent indicates growth from the previous month, while a reading below 50 represents contraction in China's manufacturing sector. The index, which is a closely watched barometer of the health of the Chinese economy, marked an 11-month low last month. "China's manufacturing growth has started to stabilize on the back of modest improvements of new business and output," HSBC Chief Economist for China Qu Hongbin said in an accompanying statement. "This is mainly driven by the initial filtering through of recent fine-tuning measures and companies' restocking activities, despite the continuous external weakness," Qu said. China's economy expanded 7.5 percent year-on-year in the second quarter, further slowing from 7.7 percent growth in the first quarter.