China's PMI drops to 50.4 % in Oct.

China's Purchasing Managers' Index (PMI) dropped to 50.4 percent in October after rising for two consecutive months, down 0.8 percentage points from September, the China Federation of Logistics and Purchasing (CFLP) said Tuesday. The CFLP report said the drop indicated the country's economic growth might continue to slow down in the fourth quarter but the trend of a moderate economic increase would not change fundamentally. It estimated the country's gross domestic product, or GDP, would grow around 9.2 percent in 2011. PMI is a gauge of manufacturing expansion. A reading below 50 indicates contraction from the previous month, while a reading above 50 indicates expansion. China's PMI had declined for four months in a row to a low of 50.7 percent in July before rebounding to 50.9 percent in August. The manufacturing index from the logistics federation is based on a survey of purchasing managers in more than 820 companies in 20 industries.