China's Manufacturing Sector Shows Improvement, Property, Job Market Worrying: HSBC PMI

China's better than expected performance in its manufacturing sector halted fears of a slowing economy but experts are still pessimistic about the country's job and property market, based on a preliminary survey report.

The HSBC flash reading on manufacturing, Purchasing Manager's Index or PMI, rose to 50.5 in September from 50.2 in August, beating the forecast of just  50.0. ECONCN. A reading of 50.0 indicates expansion.

"This is an improvement compared to what markets are expecting [but] If we just look at recent numbers, this is just hovering at 50. So the bigger picture shows that it is growing but only marginally and very slow compared to past standards," said John Zhu, Greater China economist at HSBC, reports  CNBC.

Asian stocks reacted in a mixed manner to the survey with the Shanghai Composite going up 0.8 percent.  The Australian dollar rose 0.2 percent against the U.S. dollar but lost the momentum at closing. Australia's main index .AXJO moved up 1 percent, while MSCI's  index of Asia-Pacific shares outside Japan .MIAPJ0000PUS gained 0.2 percent, reports Reuters. 

The PMI indexes were awaited as China's performance in recent months has not kept pace,  with  August  showing the lowest figures since the 2008 global financial crisis. China's earlier vibrant property market has also been reflecting the slowing economy with a dip for a fourth straight month.

The PMI sub-indexes on the employment front dropped to 46.9 - its lowest since February 2009 .

The Chinese government is not too worried about the numbers. Premier Li Keqiang said at the World Economic Forum recently that the government was prepared to handle any slowdown in the economy and had all policy measures in place.

The government is refusing to take hasty measures and has responded with the People's Bank of China lending  $81 billion to its five largest lenders. The financial authorities are yet not prepared to introduce interest rates cut or bring down the Reserve Requirement Ratios.

"While the [targeted measures] are slightly less ideal, let's not forget we are not yet in contractionary territory. We are just trying to smooth temporary weakness so the big guns like interest rate and RRR [reserve requirement ratio] cuts are still there but we don't think the data warrant that," he said, reports CNBC.

A full picture will emerge only after the final HSBC/Markit manufacturing PMI is revealed  Sept. 30.