Asia report: Stocks mostly lower at end of Q3 after mixed China factory PMIs

Stocks in Asia Pacific were mostly lower on the last trading day of the third quarter following the release of mixed survey data on China's manufacturing sector.

The official Chinese NBS factory sector Purchasing Managers' Index printed at 50.1 for September, up from 49.4 in August (consensus: 49.7).

However, the rival Caixin survey, which has a greater focus on the private sector, coastal regions and exporters, as opposed to state-owned enterprises, fell from 49.5 to 48.1 (consensus: 49.5).

Analysts at Pantheon Macroeconomics also noted that SOEs were exempted from zero-Covid restrictions and that heavy industry was likely benefitting from an infrastructure push by Beijing.

Japan's Nikkei-225 fell 1.84% to 25,937.21, but the Shanghai Stock Exchange's composite index was better behaved, dipping just 0.55% to 3,024.39, ahead of the 1 October start of the National Day golden week.

It was a similar story in South Korea where the Kospi slipped by just 0.36% to 672.65, while Hong Kong's Hang Seng added 0.33% to 17,222.83.

Helping the Kospi, analysts at Citi said FTSE Russell's decision to add the country to its watchlist for possible inclusion to the FTSE World Government Bond Index was a positive development, Dow Jones Newswires reported.

On the flip side, Citi analysts reportedly also said on Friday that South Korea might be headed into a "mild" economic recession due to the downturn in the semiconductor industry.

Down Under, the ASX 200 index gave back 1.23% to 6,474.20.

In currency markets, USD/JPY was up 0.04% to 144.52 while against the Greenback, China's yuan drifted lower by 0.1% to 7.1182.