China’s factories return to growth, helped by AI demand

China’s official factory gauge rose to 50.1 in September from 49.8 in August, moving back above the 50 line that separates expansion from contraction. That makes it the first growth reading since June and reflects firmer output and new orders, especially in equipment and high-tech manufacturing—areas benefiting from demand for AI hardware. Services also improved, lifting the broader non-manufacturing gauge to 50.2. The reading is a welcome sign after a weak quarter, but it does not amount to a broad recovery: smaller manufacturers remained in contraction, and subdued consumer demand still weighs on the economy.