Stock closed lower on the PMI data from the Eurozone. Markit Economics released its preliminary manufacturing purchasing managers’ index (PMI) for the Eurozone on Monday. Eurozone’s preliminary manufacturing PMI declined to 51.5 in May from 51.7 in April. Analysts had expected the index to increase to 51.9.
Output in the manufacturing sector showed a softer growth.
Eurozone’s preliminary services PMI remained unchanged at 53.1 in May. Analysts had expected the index to climb to 53.3.
New business in the services sector rose at the weakest pace since January 2015.
“A disappointing flash Eurozone PMI for May adds further to the suggestion that the robust pace of economic growth seen in the first quarter will prove temporary,” Markit’s Chief Economist Chris Williamson said.
“The forward-looking indicators also suggest that growth is more likely to weaken further than accelerate,” he added.
Germany’s preliminary manufacturing PMI climbed to 52.4 in May from 51.8 in April, beating forecasts of a rise to 52.0. Germany’s preliminary services PMI was up to 55.2 in May from 54.5 in April. Analysts had expected index to increase to 54.6. The rise in the manufacturing and services PMI was driven by a backlogs and increased new orders.
France’s preliminary manufacturing PMI rose to 48.3 in May from 48.0 in April. Analysts had expected the index to rise to 48.8. The manufacturing index was driven by a slower decline in new orders and in input prices.
France’s preliminary services PMI climbed to 51.8 in May from 50.6 in April. Analysts had expected the index to remain unchanged at 50.6. The services index was driven by rises in new orders, employment and input prices.
The European Central Bank (ECB) chief economist Peter Praet said in an interview with the Portuguese newspaper Publico on Monday that the central bank could cut its interest rates further but it would depend on conditions.
Falling oil prices also weighed on stock markets. News that Iran has no plans to freeze its oil production also weighed on oil prices. Iran’s Deputy Oil Minister Rokneddin Javadi said on Sunday that the country was not ready to freeze its oil output as it has not reached pre-sanctions levels. He noted that Iran’s crude oil exports, excluding gas condensates, reached 2 million barrels a day, adding that the country’s crude oil export capacity was expected to reach 2.2 million barrels a day by the middle of summer.
Indexes on the close:
Name Price Change Change %
FTSE 100 6,147.53 -8.79 -0.14 %
DAX 9,842.29 -73.73 -0.74 %
CAC 40 4,325.1 -28.80 -0.66 %
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