The Caixin/Markit Manufacturing Purchasing Managers’ index has fallen to 50.3 in April.
That’s rather lower than March’s 51.2, and weaker than expected.
It’s also rather close to the 50-point mark that determines expansion from contraction, which means China’s factory sector may be faltering.
Chinese firms reported that production and new business growth slowed, and optimism about the outlook over the next 12 months fell to the lowest this year.
Worryingly, companies are also cutting jobs at the fastest rate since January.
Here’s a summary of the key points (the full report’s online here)
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Today we’re learning how the world’s factories performed in April.
Data firm Markit is releasing its monthly Purchasing Managers Index reports, which will show if manufacturers posted faster or slower growth last month.
Economists are expecting the eurozone to post robust growth again, with the manufacturing PMI coming in unchanged at 56.8. Any reading over 50 shows growth.
A strong reading would underline how Europe’s economy is picking up speed this year, as its recovery gathers some momentum.
However, the UK’s manufacturing PMI is expected to drop to 54.0, from 54.2 in March, showing slower growth.
Michael Hewson of CMC Markets has the details:
The final manufacturing PMI numbers from Spain, Italy, France and Germany are expected to remain fairly resilient at 54.3, 55.9, 55.1 and 58.2 respectively….
Of more concern is the fact that in recent months UK manufacturing PMI’s have been drifting lower, and not higher. Today’s April manufacturing PMI number is expected to come in at 54, down from 54.2, and weaker for the fourth month in a row since December’s 56.1. While 54 is still a decent number the trend has been in the opposite direction to the recent trend in Europe.
Later this morning, Eurostat releases March’s eurozone labour market figures. Could we get a new post-crisis low?
Here’s the key timings:
8.15am BST: Spanish manufacturing PMI
8.45am: Italy manufacturing PMI
8.50am: France manufacturing PMI
8.55am: Germany manufacturing PMI
9am: The Eurozone manufacturing PMI
9.30am: The UK manufacturing PMI
10am: Eurozone unemployment figures
We’ll also be watching Greece, and its long-running talks with lenders over fresh austerity measures. Over the weekend, Germany’s finance minister praised Athens, suggesting a deal to unlock more aid could be close….
On the corporate side, oil giant BT, investment group Aberdeen Asset Management, building group Bovis Homes and takeaway firm Just Eat are all reporting results.
Europe’s main stock markets are likely to open higher, having been closed yesterday for May Day.
Ipek Ozkardeskaya (@IpekOzkardeskay)
European markets opening call @LCGTrading#FTSE +21 pts at 7225#DAX +27 pts at 12465#CAC +8 pts at 5275
Anthony Barton
