Spreadex Market Update

Rebounding Chinese PMIs provide European with light at the end of the tunnel



China provided Western investors with a light at the end of the tunnel on Tuesday, showing it is possible to return to growth after the worst (hopefully) of the coronavirus crisis.

For February, China’s manufacturing and services PMIs had fallen to 35.7 and 29.6 respectively; for March, analysts were expecting a healthy bounce to 44.9 and 42.1. Instead the sectors saw a remarkable swing back into expansion territory.

The manufacturing PMI came in at 52.0, the highest reading since that covering August 2017. The services PMI, meanwhile, struck 52.3, taking it back to the kind of numbers that were seen prior to the outbreak.

Given that the rest of the week will see the European and US PMIs languishing at the concerning levels struck by China in February – the final readings could actually fall below the initial flash figures once the last week of March is taken into account – this rebound gave investors reason to be cautiously hopeful.

With Brent Crude up 1.5% and nearing $23 per barrel, helping BP and Shell 2.9% and 5.4% higher respectively, the FTSE added around 120 points. That took the UK index within touching distance of 5700, continuing the week’s efforts to claw back the sharp losses seen last Friday.

The DAX was even more emphatic this Tuesday, climbing 250 points to once again cross the 10000 mark. The CAC couldn’t match that enthusiasm, but did still rise 1.6% to near 4450.

As for the Dow Jones, that’s currently only forecast to add 100 points when the bell rings on Wall Street. However, the US index did see a larger increase on Monday than its European peers – it finished up nearly 700 points – something that has contributed to their early perkiness. Nevertheless that addition of 100 points would leave it only a smidge below last Friday’s highs.

SEARCH FOR AN ARTICLE:

Enter a keyword and search for all relevant articles

MARKET ANALYSIS

RECENT POSTS

Financial Trading Blog

FTSE 100 Under Pressure From Oil Ahead of CPI, Sainsbury's Earnings

Read More

Economic Diary

21.04.26

Read More

Weekly Technical Analysis

Weekly Technical Analysis

Read More

Financial Trading Blog

Nasdaq At Record Highs Ahead of Tesla, Intel Earnings

Read More

Daily Market Update

20.04.26 Monday Morning

The S&P 500 edged lower in thin trading after record highs as investors weighed renewed US-Iran tensions and...

Read More

Economic Diary

20.04.26

Read More

DISCLAIMER


Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 61% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. For professional clients, spread betting and CFD trading can also result in losses larger than your initial stake or deposit.

Spreadex Ltd is authorised and regulated by the Financial Conduct Authority, provides an execution only service and does not provide advice in any way. Nothing within this update should be deemed to constitute the provision of investment advice, recommendations, any other professional advice in any way, or a record of our trading prices. This update does not constitute or form part of an offer of, or solicitation for a transaction in any financial instrument, nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract therefore. Any persons placing trades based on their interpretation of the comments or information within this update does so entirely at their own risk.

No representation, warranty, or undertaking, express or limited, is given as to the accuracy or completeness of the information or opinions contained within this update by Spreadex Ltd or any of its employees and no liability is accepted by such persons for the accuracy or completeness of any such information or opinions. As such, no reliance may be placed for any purpose on the information and opinions contained within this update.

The information contained within this update is the intellectual property of Spreadex Ltd and is protected by UK and International copyright laws. All rights reserved. Users may however freely download, distribute and reproduce extracts of the contents, subject always to accrediting Spreadex Ltd as the source and providing a hyperlink to www.spreadex.com.