China PMI surveys shows manufacturing contracting (by Chris Oliver)

HONG KONG (MarketWatch) -- China's manufacturing contracted slightly in November, according to a pair of closely watched surveys released Thursday. The China Federation of Logistics & Planning reported its manufacturing Purchasing Managers' Index (PMI) fell to 49.0, below the previous month's 50.4 reading and less than the 50 level that separates contraction from expansion. The result missed a 49.7 forecast from a Dow Jones Newswires survey. Meanwhile, HSBC's own China PMI dropped to a 32-month low of 47.7, weaker than its initial "flash" reading of 48.0, and indicating a sharp deterioration of conditions from October's reading of 51. IHS Global Insights China analyst Alistair Thornton linked the downbeat PMI reading to the central bank's easing of required reserves for major lenders, saying: "The message is clear: the economy is slowing much faster than expected and the government has stepped into the ring. The loosening campaign has begun."