South Korea's manufacturing PMI showed stabilisation in the sector in December with the survey's headline index increasing to 50.1 from 49.4 in November. This is only the second month in 2025 where the survey did not show contraction in the sector.

Survey respondents reported modest growth in output, new orders and new export orders in December, with respondents citing the impact of new product launches and stronger external demand. Respondents also reported the first increase in payrolls in three months while the survey's measure of business confidence rose to its highest level since May. The survey shows a biggest increase in input costs since mid-2022 and the biggest increase in selling prices since March.

The Purchasing Managers' Manufacturing Index (PMI) is based on monthly questionnaire surveys of selected companies which provide an advance indication of what is really happening in the private sector economy by tracking changes in variables such as output, new orders, stock levels, employment and prices across the manufacturing sectors.

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the purchasing managers' manufacturing indexes, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures.

The Markit PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.