Spreadex Market Update
European markets quickly lose lustre after mixed morning for manufacturing
Despite managing a 19-month high PMI of 52.9 (against the 51.9 forecast), the UK’s manufacturing picture wasn’t as clear cut as that number suggests; export orders continued to fall, whilst the worrying trend of companies cutting their staffing levels persisted. Those factors, and the generally unconvinced tone from analysts, took the spark out of what initially looked like a decent number, leaving the FTSE to tumble into the red as Monday progressed.
Things were even messier over in the Eurozone. An 8 month manufacturing high for Spain (coming a week after its robust GDP data) and a 4 month high for Italy were joined by 3 and 5 month lows for Germany and France respectively, the slowdown seen by those powerhouses causing the region-wide figure to drop from 53.2 to 52.3 month-on-month. Of course this left the DAX and the CAC in the doghouse, the indices falling around 0.65-0.75% each.
It falls, then, to the US open to try and rescue the markets from their current malaise. Yet, with a cavalcade of data still to come, the Dow futures aren’t look too promising. Before the bell investors will get a glimpse at the core PCE price index figure (expected to remain unchanged at 0.1%) alongside the personal spending and income numbers (forecast at 0.1% and 0.2% respectively). One things get underway the meatier data is then released; the Markit manufacturing PMI is expected at 52.7 (an improvement on last month’s 51.2), whilst the ISM figure is forecast to remain in contraction territory at 48.6 (compared to the 48.2 revealed at the start of January).
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