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European stocks are higher this morning despite unrest in US

European stocks are higher this morning despite unrest in US 981 980 Realm

European stocks have extended their recent gains this morning despite the civil unrest across the U.S. – President Trump has threatened to use the military to end “riots and lawlessness” ignoring calls for him to soften his tone.

 

Global Macro

  • The ISM Manufacturing PMI for the US increased to 43.1 in May of 2020 from 41.5 in April which was the lowest reading since April of 2009. However, figures came below market forecasts of 43.6 and pointed to a sharp contraction in the manufacturing sector. Among the six biggest industry sectors, Food, Beverage & Tobacco Products remains the only industry in expansion. Transportation Equipment; Petroleum & Coal Products; and Fabricated Metal Products continue to contract at strong levels,” says Fiore, Chair of the ISM.
  • The IHS Markit/CIPS UK Manufacturing PMI stood at 40.7 in May 2020, little-changed from a preliminary estimate of 40.6 and above April’s record low of 32.6.. Output, new orders and export sales continued to fall at steep rates, albeit less sharply than the recordsset in April, while the pace of job shedding was the second-highest on record. On the price front, input cost inflation remained subdued as higher costs resulting from supply-chain disruptions were partly offset by supplier discounts offered in response to weak demand and also lower prices for oil, oil by-products and plastics. Looking ahead, business confidence rose to a three-month high, but remained downbeat by the historical standards of the survey.
  • The IHS Markit Eurozone Manufacturing PMI came in at 39.4 in May 2020, little-changed from a preliminary estimate of 39.5 and above April’s all-time low of 33.4. Still, the latest reading pointed to a steep contraction in the bloc’s manufacturing sector as government restrictions designed to contain the coronavirus pandemic continued to severely hamper the sector. Both production and new orders fell at slower rates, with export sales falling at the second-sharpest pace in 23 years of data collection.
  • On Monday: European stocks rose in thin holiday trade after U.S. President Donald Trump stopped short of threatening tariffs on China and a private survey showed that China’s manufacturing sector moved into expansion territory in May. US stocks saw some further upside during the trading session. With the continued advance on the day, the indices ended the session at their best closing levels in three months. Asian stocks advanced after U.S. President Donald Trump stopped short of threatening tariffs on China and data showed Chinese factory activity expanded in May. Investors shrugged off political unrest in the U.S. and worries about a resurgence of the coronavirus.
  • Monday’s data below:

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