Tuesday 3 September 2013

Markets rise as manufacturing expands in Europe and China

After a turbulent August, markets made a positive start to September on Monday as data from Europe and China indicated expansion in manufacturing activity.

The MSCI All-Country World Index rose 0.6 percent. The STOXX Europe 600 Index in particular jumped 1.9 percent, the most in eight weeks.

A report from Markit on Monday showed that its manufacturing PMI for the euro area rose to 51.4 in August, the highest in 26 months, from 50.3 in July.

UK manufacturing performed even better. The Markit/CIPS manufacturing PMI jumped to 57.2 last month, the highest in 18 months, from 54.8 in July.

Also showing improvement, albeit more modestly, was China's manufacturing sector. HSBC's manufacturing PMI for China rose to 50.1 in August from 47.7 in July, thus indicating an end to three months of contraction.

The HSBC data on Monday followed a report on Sunday from the National Bureau of Statistics that showed the latter's manufacturing PMI for China hitting a 16-month high of 51.0 in August from 50.3 in July.

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