Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Chinese PMI causes mild disappointment

15.25 AEDT, Friday 1 February 2013

Chinese PMI causes mild disappointment


By Tim Waterer (Senior Trader, CMC Markets)

If the US Payrolls data is incongruent with the optimistic rally of recent months, a sizeable ‘question mark’ will be placed next to the current elevated pricing levels. So far this year the market has shown a great ability to absorb bad news by reacting with only modest declines, as was the case with the US GDP contraction. However, a poor Payrolls result may be a more significant test of the market’s resolve. While traders will likely give any result around the 160k level a ‘pass’ mark, Federal Reserve officials won’t be feeling overly cheery until we start seeing consecutive prints above the 250k level.

On balance, if the Chinese PMI readings today were disappointing it was only mildly so. It is almost a case of ‘take your pick’ as to which PMI number (the government one or the HSBC one) is the most accurate reflection of the manufacturing story in China, with bullish traders likely to focus on the HSBC reading while the bears will place more stock on the official reading.

If the AUD is a barometer for Chinese economic health then the downward reaction to the PMI data is evidence that the numbers underwhelmed somewhat. Soft domestic PPI data also contributed to AUD weakness today with the currency facing a battle to remain above the 1.04 level. The AUDUSD rate could be looking at a fall to 1.0370 this evening if we see a risk-off theme in the aftermath of the US jobs report. The AUD will likely bear the brunt of any broad downward shift in risk sentiment, while conversely the moves higher by the AUD could be limited with the Euro attracting much of the buying enthusiasm in currency markets these days.

The Australian sharemarket did not spend too much time dwelling on the end of the 10 day winning streak on Thursday. Nor did our market seem overly concerned about the average Chinese PMI data today. The key mining and financial stocks stepped up to the plate as the ASX200 again reclaimed the 4900 level. With the Australian bourse now on a new ‘one day’ winning streak, US jobs data will likely be instrumental in whether 5000 is on the radar for the local bourse next week.
ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Tax: GST Threshold For Online Purchases Won't Lower Before 2018

The government wants to lower the threshold on online purchases which qualify for GST from mid-2018, but says more work is needed and there will be no change without public consultation. More>>

ALSO:

North Canterbury: Government Extends Drought Classification

The government has extended a drought classification for the eastern South Island until the end of the year, meaning the area will have officially been in drought for almost two years, the longest period for such a category. More>>

ALSO:

Negotiations Fail: Christchurch Convention Centre Build To Proceed Without PCNZ

After protracted negotiations, the government has ditched the construction consortium it picked to build Christchurch's replacement convention centre, which it now anticipates delivering at least two years behind the original schedule. More>>

ALSO:

Ruataniwha: Greenpeace Launches Legal Challenge Against $1b Dam Plan

Greenpeace NZ is launching a legal challenge against a controversial plan to build a dam that’s set to cost close to $1 billion and will pollute a region’s rivers. More>>

ALSO:

Inequality: Top 10% Of Housholds Have Half Of Total Net Worth

The average New Zealand household was worth $289,000 in the year to June 2015, Statistics New Zealand said today. However wealth was not evenly distributed, with the top 10 percent accounting for around half of total wealth. In contrast, the bottom 40 percent held 3 percent of total wealth. More>>

ALSO:

What Winter? Temperature Records Set For June 20-22

The days around the winter soltice produced a number of notably warm tempertaures. More>>

Conservation Deal: New Kākāpō Recovery Partnership Welcomed

Conservation Minister Maggie Barry says the new kakapo recovery partnership between DOC and Meridian Energy is great news for efforts to save one of New Zealand’s most beloved birds. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news