Nov manufacturing PMI falls further to 49.4
Nonmanufacturing index expands at slower pace
New export orders extend decline for ninth month
Factory managers losing confidence in policy support analysts

BEIJING, Nov 30 Reuters China39;s manufacturing activity shrank for a second straight month in November and at a quicker pace, suggesting more stimulus will be needed to shore up economic growth and restore confidence that the authorities can ably support industry.

Economists upgraded their forecasts for the world39;s secondlargest economy after betterthanexpected third quarter data, but despite a flurry of policy support measures, negative sentiment among factory managers appears to have become entrenched in the face of weak demand both at home and abroad.

The official purchasing managers39; index PMI fell to 49.4 in November from 49.5 in October, National Bureau of Statistics data showed on Thursday, missing economists39; forecast of 49.7. The 50point mark demarcates contraction from expansion.

The domestic market cannot make up for losses in Europe and the United States. The data shows that factories are producing less and hiring fewer people, said Dan Wang, chief economist at Hang Seng Bank China.

The data could also show a loss of confidence in government policy, she added, warning factory activity was unlikely to improve anytime soon as other economic problems dominate. The priority now is clearly containing the local government debt risk and the risk posed…