Skip to comments.China's Manufacturing Index Signals Contraction, But Markets Miraculously Maintain Gains
Posted on 01/20/2012 3:23:58 AM PST by blam
China's Manufacturing Index Signals Contraction, But Markets Miraculously Maintain Gains
Jan. 19, 2012, 11:18 PM
China's HSBC Flash Purchasing Manager's Index climbed to 48.8 in January, up from 48.7 in December.
This is a preliminary reading on Chinese manufacturing activity, ahead of the official PMI number. A reading below 50 signals contraction.
Signs that China might be slowing have been met with mixed emotions from traders. On one hand, weak data may encourage easier monetary policy, which in a sense is bullish. Then again, bad data is still bad data.
Tonight, markets are showing a mixed response to the anemic PMI number. Hong Kong's Hang Seng is up only 0.3% after being up as much as 1.0%.
Japanese, Korean, and Australian markets continue to trade higher.
(Excerpt) Read more at businessinsider.com ...
Jan. 20, 2012, 4:47 AM
We've seen a miraculous rally in equities across the board the last few days, but that optimism might be coming to an end this morning.
European shares have fallen sharply in early trading, and the headlines are once again centering around Greece.
The DAX is down 0.36%, and the CAC 40 is off 0.43%.
Even though it looks like the Greek government and private Greek bondholders will push through some kind of deal on restructuring debt holdings, Greece's financial situation remains grim, and no one's convinced that any debt swap deal will actually do anything to make the country's debt sustainable long-term.
A wary reversal in the last hour, however, suggest that this cynicism could still turn around.
All this after a stunning rally in Asia, despite a depressing China flash PMI number.
The Market reminds me of this guy:
BTW, I've seen up to a trillion mentioned in other stories.