Spreadex Market Update
European manufacturing PMIs rush to the rescue of global indices
The Eurozone led the charge, as better than expected manufacturing figures from Italy, Spain, France and, unsurprisingly, Germany then led to a 10 month high region-wide figure in another sign that ECB QE is having the desired effects. This news pushed the DAX back into the three digit gains it had seen on Monday, despite it teetering on the edge of similar numbers in the other direction after the bell.
The Eurozone wasn’t along in strong manufacturing data, with the UK’s figure hitting highs not seen since July of last year; however, this came with a worrying caveat. Despite this recovery, the country continues to see ‘unprecedented’ weak productivity at low levels not seen since World War II, suggesting a slightly decaying core at the centre of this robust manufacturing growth. And one thing hasn’t changed: the pound and the euro are still suffering in the face of the rampant dollar, with sterling suffering under its election uncertainty, causing it to also give back yesterday’s gains against the Eurozone currency.
The dollar strength maybe the reason why the US futures are not as promising as their indices peers in Europe. There is also the pressure of the Iran nuclear talks, which are operating under what has become known as a ‘Greekish hue’, with both sides struggling to find an acceptable compromise. Investors may also be waiting for the latest ADP non-farm data, a significant indictor of Good Friday’s all-important government released non-farm figure. Frustratingly for European traders, the US is insisting on releasing its most volatility-inducing figure on a Bank Holiday, leaving the possibility for some delayed reactions come next Tuesday.
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