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Market Update

Shanghai Shines in Dim Asia

Shanghai-listed stocks notched higher Monday after upbeat Chinese industry data buoyed confidence, as investors there got their first chance to react to the Federal Reserve's surprise move, last week, to retain its monetary stimulus program.

The Shanghai Composite, which opened after a four-day long holiday since September 19th, finished 1.3% higher.

But Mumbai and Sydney dragged in a light session.Volumes were thin as markets in Japan remained closed for a public holiday while a storm disrupted morning session in Hong Kong. Trading was resumed later in the afternoon, but the Hang Seng retreated 0.6%.

Mumbai's Sensex lost 1.8% while Sydney's S&P/ASX All Ordinaries was down 0.5% at close.

Data released in China showed industry output in the world's second-largest economy expanded for a second time in September. The HSBC flash purchasing managers' index hit a six-month high of 51.2 in September from 50.2 in the previous month.

A reading above 50 indicates expansion in economic activity and vice versa. The final print of purchasing managers index' will be released on September 30th.

In other important news, Germany re-elected Angela Merkel as the Chancellor in Sunday's federal elections. Merkel, however, finished short of an absolute majority as her coalition partners failed to garner enough votes to win seats in the parliament.

Stocks on the Move

Shanghai-listed industrial stocks ticked higher on heels of the upbeat manufacturing output report.

Engineering construction company China Railway Construction gained 0.8% while Baoshan Iron & Steel Co. was up 0.5%.

Metal player Jiangxi Copper tacked on over 2% and Aluminum Corp. of China rose 2.8%.

Other resources stocks were also higher. PetroChina, China Petroleum & Chemical Corp improved and Sinopec Shanghai Petrochemical climbed around a percent each.

Miners in Sydney, however, logged modest losses despite the positive Chinese data. China being Australia's largest export market, especially for commodities, any change in Chinese industrial activity has a bearing on Australian miners.

But mining stocks pushed lower in today's trade tracking weakness in global metal prices.

Index leader BHP Billiton was down 0.8% and Rio Tinto eased 0.5% while gold miner Newcrest Mining slumped over 8%.

Banks and oil firms were also listless.

In Mumbai, stocks continued to tread lower after the central bank, on Friday, surprisingly hiked its lending rate by 25 basis points.

Banks were among the top losers with SBI plunging 5.4%, ICICI Bank down 4.5% and HDFC Bank erasing 2.7%.

Auto-firms and capital goods stocks were among other major losers. Maruti Suzuki reversed 5.2%, ONGC lost 4.9%, BHEL gave up 4% while Tata Power, NTPC and Jindal Steel retreated around 3% to 4%.