:::LALKAR GROUP::::

Mainland China share market finished session lower on Wednesday, 31 May 2023, as risk sentiments hit after weaker than expected manufacturing data offered the latest evidence that recovery in the world's second-biggest economy is faltering.

Bearish factory activity data, on the heels of lacklusture consumption and industrial production figures, is further evidence China's post-reopening recovery is losing steam, heaping pressures on policymakers to shore up the patchy economic recovery.

Traders are now waiting for more stimulus measures to support the wobbly recovery, but Beijing might be more cautious this time around as policymakers are faced with a smaller policy toolkit, a structural collapse in the property sector, and a much more complicated geopolitical situation

At close of trade, the benchmark Shanghai Composite index declined 0.61%, or 19.65 points, to 3,204.56. The Shenzhen Composite Index, which tracks stocks on China's second exchange, was down 0.44%, or 8.81 points, to 2,003.18. The blue-chip CSI300 index dropped 1.02%, or 39.21 points, to 3,798.54.

ECONOMIC NEWS: China Manufacturing PMI Contracts Further In May- China manufacturing sector continued to contract in May, and at a faster rate, the latest survey from the National Bureau of Statistics showed on Wednesday. The official manufacturing purchasing managers' index (PMI) came in at 48.8 in May, down from the prior month's reading of 49.2. A reading above 50 shows expansion in activity for the month, while a reading below indicates contraction. The bureau also said the non-manufacturing index came in with a score of 54.5, down from 56.4 in the previous month. The composite index had a score of 52.9, down from 54.4 a month earlier.

CURRENCY NEWS: China's yuan weakened against the dollar on Wednesday, inline with softer official guidance fixing. Prior to market opening, the People's Bank of China set the midpoint rate CNY=PBOC at 7.0821 per U.S. dollar, 3 pips weaker than the previous fix 7.0818. In the spot market, the yuan CNY=CFXS was changing hands at 7.1045 at midday, 257 pips weaker than the previous late session close.