Exchange traded funds that invest in Chinese stocks gained in early U.S. trading Monday after an index of purchasing managers rose in October.

HSBC’s flash purchasing managers’ index climbed to 51.1 in October from 49.9 the previous month.

“Thanks to the pick-up in new orders and output, the headline flash PMI rebounded back into expansionary territory during October, marking a steady start to manufacturing activities in the four quarter,” said Qu Hongbin, China economist at HSBC, in a Reuters report.

“Meanwhile, inflation components within the PMI results confirmed stable output prices growth and slower input price inflation. All these data confirm our view that there is no risk of a hard landing in China,” he said.

The iShares FTSE China 25 Index Fund (NYSEArca: FXI) was up 3% on Monday morning.

The China ETF has lost momentum after starting October with a bang. China’s GDP growth for the third quarter was 9.1%. [China ETFs Slumping Again]

iShares Trust FTSE China 25

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.