Daily Digest: Friday 22nd November
Market Round-Up
Friday marked the release of flash PMI data for the month of November. While flash figures are not final, they essentially offer early insights into the directional trends of a nations economic performance, supporting analysts assessments of GDP and economic health. PMI is a metric used to measure industry performance against a numerical scale, 50 marks a midpoint from which data below signals a contraction of economic activity within a sector, while any figure exceeding 50 signals expansion. Nations across the Eurozone were the first to report data this morning, followed by the UK, and then USA this afternoon.
In the UK, the service sector accounts for just over 80% of GDP. Therefore, service sector growth is essential for two reasons: supporting wider GDP expansion while offsetting the economic impact of manufacturing sector declines as the primary industry of the UK economy shifts. During November, flash service estimates came in at 50, on the borderline of growth with data falling 1.9 points short of analyst estimates indicating weaker than expected growth.
In terms of manufacturing, due to sector health in the UK, major upward and downward shocks are not usually expected. Flash estimates came in at 48.6, 1.4 points below analyst expectations of 50, suggesting that the pace of performance declines had accelerated beyond predictions.
During trading, the UK’s FTSE 100 (FTSE) continued higher, rising 112.81 points (1.38%). This marked the index’s strongest performance of the week to close at 8,262.08.
Turning to Europe, Eurozone services PMI came in at 49.2, indicating a slight contraction of service output, falling short of expectations of an expansion. On the other hand, manufacturing estimates came in at 45.2, only marginally lower than analyst expectations, as output declines continue to be observed across Eurozone nations. Despite seemingly poor PMI estimates, the STOXX 600 (STOXX) rallied 5.93 points (1.18%) to 508.47.
US estimates were indicative of stronger economic conditions, with service figures coming in at 57, while manufacturing data came in at 48.8. Service output growth exceeded analyst expectations, manufacturing sector declines should be adequately covered.
US equity performances continued to strengthen as the three major indexes saw gains for a second consecutive. The Dow ($INDU) led gains rising 426.12 points (0.97%) to 44,296.51, followed by the S&P 500 ($SPX) which rose 20.56 points (0.35%) to 5,969.67, and the Nasdaq 100 ($NDX) rose 35.45 points (0.17%) to 20,776.23.
Sources:
https://uk.finance.yahoo.com/world-indices/
https://uk.finance.yahoo.com/commodities
https://www.londonstockexchange.com/indices/ftse-100
https://www.binance.com/en-GB/price/bitcoin
https://www.binance.com/en-GB/price/ethereum
https://qontigo.com/index/sxxp/
Stock Market Activity Today & Latest Stock Market Trends | Nasdaq
https://coinmarketcap.com/charts/#market-cap
https://www.forexfactory.com
Definitions:
YoY - Year on Year, or, Year over Year
MoM - Month on Month, or, Month over Month
QoQ - Quarter on Quarter, or, Quarter over Quarter
ECB - European Central Bank
BOJ - Bank of Japan
Fed - Federal Reserve
BOE - Bank of England
SNB - Swiss National Bank
DOJ - Department of Justice
SEC - Securities & Exchange Commission