Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Is Europe’s economy still stuck in a rut, or turning a corner? Investors will get fresh clues today when data firm IHS Markit releases its ‘flash’ surveys of purchasing managers in France, Germany, and the rest of the eurozone for this month.
March was pretty grim, with eurozone factories suffering their biggest drop in output in six years as trade conflicts between the US and China caused global ripples.
These new PMI reports, due by 9am, may show that activity is picking up in April. That would be a welcome sign, especially after China posted stronger growth than expected yesterday (6.4% in the first quarter of 2019).
Germany’s manufacturing PMI is expected to rise to 45.2 from 44.1 — that’s still a low figures, indicating factories kept contracting. But its services sector will probably keep growing (with a PMI of around 55, down from 55.4 in March)
The French data isn’t expected to sparkle. France’s factory PMI is tipped to rise from 49.7 to 50 — which would show stagnation. The services PMI could rise from 49.1 to 49.8 (a small contraction).
Jasper Lawler of London Capital Group explains why investors will be watching:
There is a feeling in the markets that the global economy is just starting to stabilise. Traders will pay particular attention to Germany’s manufacturing sector, which suffered a sharp contraction across recent months.
Investors are slowly starting to believe that the second quarter could be an improvement on the first, economically. However, more economic data is needed to confirm these suspicions. Today’s eurozone and US PMI data could go a long way to confirming or disproving such beliefs.
Also coming up today
The latest UK retail sales figures are released. They’re expected to show that British consumers spend less in the shops in March, with retail sales (excluding fuel) down by 0.3%.
Konstantinos Anthis, head of research at ADSS, explains:
Brexit uncertainty during the past month, as the UK was scrambling to get an extension from the EU, should be reflected on the consumer spending figures.
In the City, consumer good giant Unilever and pest control firm Rentokil are releasing financial results. They’ve both posted solid sales growth.
The board of pizza chain Domino faces a shareholder revolt over its pay policies at its AGM today.
Plus, Pinterest will be floating on Wall Street.
- 9am BST: Eurozone ‘flash’ PMIs for manufacturing and services in April
- 9.30am BST: Bank of England credit conditions survey
- 9.30am BST: UK retail sales for March
- 1.30pm BST: US retail sales for March