Japan approaches new high, China PMI contracts

South Korean exports in February rose 4.8% from a year earlier to $52.41 billion, beating Reuters’ estimates of a 1.9% increase, on strong demand for its semiconductors, preliminary government data showed.

The export print compares to a 18% growth in January. Overall, imports fell by 13.1%, steeper than estimates of a 10.4% drop.

“The ICT cycle (Information and Communications Technology cycle) is on an upturn,” said Trinh Nguyen, senior economist at Natixis. “With the manufacturing cycle returning to to growth in the U.S., that should support South Korea,” she added.

—Lee Ying Shan

Japan’s February factory activity shrank at the fastest pace in more than three years on the back of weakening demand.

The au Jibun Bank’s flash Japan manufacturing purchasing managers’ index fell to to 47.2 in February, compared with January’s 48.0 reading, indicating continued contraction in private sector business activity.

The reading signals a ninth consecutive deterioration in business activity and the strongest contraction recorded since August 2020, according to au Jibun Bank.

Japan’s benchmark index has continued to extend its rally after surging to an all-time high last week. The Nikkei 225 was trading 1.83% higher at 39,883.86 in Friday morning trading.

—Lee Ying Shan

Paytm will discontinue inter-company agreements with its troubled payments bank unit, the financial technology firm said in a statement on Friday.

Shares of Paytm, listed as One97 Communications, on India’s National Stock Exchange jumped almost 5% in early India trading hours.

“As part of this process to reduce dependencies, Paytm and PPBL (Paytm Payments Bank Limited) have mutually agreed to discontinue various inter-company agreements with Paytm and its group entities,” the statement read.

Paytm did not specify what agreements were being terminated.

This comes just days after Paytm CEO Vijay Shekhar Sharma stepped down as non-executive chairman and board member of the payments bank unit in a major shakeup following the Reserve Bank of India clampdown.

— Shreyashi Sanyal

China’s manufacturing activity contracted for a fifth straight month in February, official figures on Friday showed, which were at odds with a private survey that signaled factory activity expanded.

Data from China’s National Bureau of Statistics showed manufacturing PMI fell to 49.1 in February from 49.2 in January. The reading was in line with a Reuters poll estimate.

The Caixin/S&P Global manufacturing PMI, however, edged up to 50.9 in February from 50.8 in the previous month.

A PMI reading above 50 indicates expansion, while below that denotes a contraction.

“Companies noted further upturns in both production and new work, with rates of growth quickening slightly from January, helped in part by a rise in new export orders,” the private Caixin survey read.

— Shreyashi Sanyal

India’s economy grew much faster than expected in the October to December quarter, and at its fastest pace in six quarters.

Data showed GDP grew 8.4% in the third fiscal quarter, blowing past Reuters Poll expectations of 6.6% growth, on the back of higher private consumption and strong manufacturing and construction activity.

The October-December quarter reading was also higher than the 7.6% growth clocked in the prior three months.

The Indian government raised its GDP growth outlook for fiscal year 2023-24 to 7.6% from 7.3% forecast earlier.

The data also boosted Prime Minister Narendra Modi’s economic record ahead of a highly anticipated national election.

“For PM Modi and BJP who will be going to the polls in April-May, it will yet provide another boost. For RBI (Reserve Bank of India), the strong growth momentum will only reinforce their bias to stay on hold at 6.5% for the foreseeable future,” Commerzbank analysts wrote in a note.

— Shreyashi Sanyal