Trump’s comments were “long on criticism of China but short on action,” Stephen Innes, chief global markets strategist at AxiCorp, wrote in a research note Monday.
“Reopening of optimism reigns supreme,” wrote Innes.
Recent data from China indicates that factories are beginning to recover from the pandemic.
Manufacturing activity in the country unexpectedly increased last month, according to a closely watched private survey. Media group Caixin said Monday that China’s manufacturing purchasing managers’ index rose to 50.7 in May, from 49.4 in April. It also exceeded 49.6 than analysts surveyed for Refinitiv had waited. A number above the 50-point level indicates growth.
“Manufacturing output recovered faster than demand as the national economy recovered from the epidemic,” Wang Zhe, a senior economist at Caixin Insight Group, wrote in a statement accompanying the Caixin data. Wang added, however, that exports remain slow as the rest of the world continues to grapple with the virus.
Over the weekend, the Chinese government also reported that its official manufacturing PMI grew in May. The official PMI non-manufacturing survey, which measures the service sector, also indicated expansion, another suggestion that domestic economic activity is picking up, according to Jeffrey Halley, senior market analyst for Asia Pacific in Oanda.
However, South Korea and Taiwan saw manufacturing output decline in May. And while output in the Philippines, Vietnam, Malaysia and Thailand improved as blockages eased, PMIs for those Southeast Asian countries still indicated contraction rather than growth, according to Alex Holmes, Asia economist at Capital Economics.
“The overall picture remains the same: the region’s manufacturing sector is in a deep recession,” Holmes wrote in a note Monday. “Production is likely to be well below normal levels for many months as domestic and global demand remains very depressed.”