MEXICO CITY, Nov 3 (Reuters) - Mexico’s manufacturing sector in October had its best month since March, but overall activity remains well down on the previous year’s levels as the coronavirus pandemic continues to stymie business, a survey showed on Tuesday. The IHS Markit Mexico Manufacturing Purchasing Managers’ Index ticked up to 43.6 in October from 42.1 in September, still well below the 50-threshold that marks the boundary between contraction and expansion. The index is slowly recovering after plunging to 35.0 in April, the lowest point in the survey’s nine-year history. “The latest PMI data showed that the COVID-19 pandemic continued to have a domino effect on the Mexican manufacturing industry, harming sales, production and employment during October while posing uncertainty towards the outlook,” said Pollyanna De Lima, Economics Associate Director at IHS Markit. Still, Mexico is beginning to make up ground lost in the pandemic, and figures published last week showed that Latin America’s second-biggest economy expanded by 12% quarter-on-quarter during the July-September period. De Lima noted that while some key indicators pointed to slowing rates of contraction, they are still weak historically. “Also, with infection numbers rising and the possibility of containment measures being implemented, companies turned pessimistic towards growth prospects following short-lived optimism in September,” she said. A gauge of employment in manufacturing rose to 45.6 from 44.6 a month earlier, the survey showed. By contrast, a measure of future output slipped to 47.4 from 51.9 in September. The PMI index tracks developments on a range of business indicators including prices, new orders, output, employment, suppliers’ delivery times and stocks of raw materials. (Writing by Dave Graham Editing by Chizu Nomiyama)