Global stocks shrug off slowdown in China's manufacturing

Global stocks including Asia started the week higher Monday, even as China reported a slowdown in manufacturing activity and countries continued to be hammered by the Delta variant.

Tokyo's Nikkei 225 jumped 1.7% to 27,742.28, while the Kospi in Seoul rose 0.1% to 3,205.43. The Hang Seng in Hong Kong advanced 0.9% to 26,189.44 after being in the red for much of the morning. The Shanghai Composite index added 0.7% to 3,422.64, while Australia's S&P/ASX 200 was up 1.5% at 7,501.20. The benchmark in Malaysia rose while those in Singapore and Indonesia fell. The gains in China follow data released Saturday by the National Bureau of Statistics showing the country's official purchasing managers' index fell to 50.4 in July from 50.9 in June.

Hong Kong, Shanghai and Shenzhen indexes eased in early trade, before abruptly reversing course as foreign investors pumped almost a billion dollars in markets. That has seen a stunning reversal as regulatory risk has been forgotten," Jeffrey Halley of Oanda said in a report.

Investors were spurred by encouraging earnings on Wall Street, which recently wrapped up another strong month. The S&P 500 notched six straight months of gains ending July. France's CAC 40 added 1% in early trading to 6,677.27 while Germany's DAX gained 0.4% to 15,606.27. Britain's FTSE 100 rose 0.9% to 7,096.59. US shares were set for a positive opening, with S&P 500 futures advancing 0.6% to 4,414.75. Dow futures climbed 0.5% to 35,007. A notable 89% of companies on the S&P 500 have beaten earnings expectations, but it is unclear if the market upswing will persist, Yeap Jun Rong of IG said. "Guidance from several big tech companies is pointing to slower growth ahead and markets may need to find another catalyst to drive further upside," he added.

The moves follow a buoyant Asian session, where Tokyo's Nikkei 225 jumped 1.8% to close at 27,781.02. The Kospi in Seoul rose 0.7% to 3,223.04, while the Hang Seng in Hong Kong climbed 1.1% to 26,235.80. The Shanghai Composite index added 2% to 3,464.29 and Australia's S&P/ASX 200 was up 1.3% at 7,491.40. Benchmarks mostly rose across the region.