According to analysts at TD Securities, after dipping back into contraction territory in April, the manufacturing PMI of China is likely to edge higher in May though it may be a stretch to expect a move back above 50.

“We expect the PMI to rise to 49.8 in June from 49.4 previously, supported by hopes of progress on US-China trade talks at the G20 meeting, while any improvement will be dampened by the economic damage from current tariffs and slowing activity. Improved liquidity will have helped sentiment. Manufacturing sentiment has become more correlated with equity market performance and the 5% rise in Chinese equities this month (CSI) also points to a higher PMI.”