November was the busiest month for eurozone factories in 17 years claimed new purchasing managers’ index data earlier from IHS/Markit. The numbers came in at 60.1 compared to 58.5 for October though growth looks still weak in Greece (predictably) but much stronger in Germany.
"Given the surge in demand for inputs caused by the production growth spurt, it’s not surprising that recent months have seen some of the most severe supply chain bottlenecks in the history of the euro," said IHS/Markit economist Chris Williamson. "With demand often exceeding supply, we’re seeing a shift to a sellers’ market, with growing numbers of suppliers able to hike prices."
The euro put on a +0.09% gain buying 0.8806 of the British currency while the pound slipped -0.34% to 1.3481 against the dollar. News also emerged today that US manufacturing activity slipped in November though construction work, according to the US Institute for Supply Management, increased.
Despite an initial -0.15% fall US stocks rose – again – slightly today. Mid-afternoon London time the Dow was up +0.05% at 24,284.
The US Senate votes later on President Trump’s tax code changes though worries about what the changes might do to the US tax base has sent some of the legislators back to the small print. Earlier a Congressional watchdog said the Trump changes could send the budget deficit higher.
At close of business the FTSE 100 ended 26 points lower at 7,300 with Primark owner ABF and Severn Trent seeing -2.6% and -2.5% slips. Prudential and RBS also saw chunky falls.
- UK FTSE 100 7,300 -0.36%
- Dow 24,269.11 -0.02%
- S&P 500 2,648.05 +0.01%
- Nasdaq 6,866.23 -0.11%
- Nikkei 225 22,819.03 +0.41%
- DAX 12,987.55 -0.28%
- CAC 40 5,369.64 -0.05%
- Gold 1,275.70 -0.07%
- Oil WTI 58.94 +2.16%
UK manufacturing also up; inward investment climbs
While there was strong eurozone PMI data on show earlier, UK manufacturing also showed a clean pair of heels: growth surged at its fastest clip for four years. The IHS/Markit Purchasing Managers' Index came in at 58.2 in November. The best number for 51 months.
Adding to the positive sentiment was high rates of foreign investment thanks to a rash of takeover deals. In total the Office for National Statistics saw UK overseas inward investment come in at £145.6bn for 2016 compared to just £25.3bn in 2015.
What is significant is that much of the investment was pre-planned before the Brexit referendum vote. Some of the biggest deals included BG Group being snapped up by Shell (a deal that looks increasingly well timed) plus Softbank buying ARM Holdings.
First day at easyJet for new boss Lundgren
Today was day one for easyJet’s new boss Johan Lundgren who takes over from Dame Carolyn McCall. “This is an exciting time to be joining Europe's leading airline,” he said recently. “Carolyn has built a fantastic team and with them I look forward to contributing to easyJet's continued success.”
However Lundgren has his work cut out. He has to figure out how to integrate the bits of Air Berlin easyJet has bought not to mention Monarch and Alitalia. He has to handle Stelios Haji Ioannou (not the easiest of personalities) plus pilot a post-Brexit landing. Oh, and worry about rising fuel prices and terrorism.
However Lundgren has racked up 30 years’ of experience of the travel industry (his last post was at Tui Travel as deputy chief executive). easyJet shares were +2.19% higher tonight at 1,436.73p.
Breaking news: Republicans in the US have garnered, just in time, the support of of two wavering senators for Donald Trump's new tax plan. Ron Johnson of Wisconsin and Steve Daines of Montana will support Trump.