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

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news