Markets have shrugged off mixed data in Asia overnight delivering a robust start to the month as equity indices across Asia and Europe see green. Looking at China, there was a slight discrepancy between the official and the Caixin-Markit manufacturing PMI’s with the official data signalling a contraction in manufacturing while the Caixin survey came in better than expected. Overall the market has taken signs of a continued deceleration in China in stride with equities on the Shanghai, Sydney and Tokyo bourses all starting the month off on a solid footing. In terms of currencies, the yen is currently flat against the greenback while we have seen a spike in both the aussie and kiwi dollars as both currencies have benefited by an uptick in commodity prices.
Moving onto Europe, the good mood established in Asia continues as a slew of economic data out of the European Union came in beating expectations. With the head of the ECB, Mario Draghi, already expected to deliver further measures in an effort to stimulate the economy on Thursday, data signalling broadly stronger than expected employment and manufacturing in the Eurozone has come at a welcome time for euro bulls with the common currency today breaking trend and actually gaining on its American counterpart. Outside of the EU, disappointing manufacturing data out of the United Kingdom has been largely disregarded as the pound sterling posts gains against both its European and American counterparts.
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