Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Europe Points Higher After China's Markets Whipsaw, PMIs Next

By City Index (Fiona Cincotta)Stock MarketsJun 23, 2020 04:18AM ET
www.investing.com/analysis/europe-points-higher-after-chinas-markets-whipsaw-pmis-next-200528545
Europe Points Higher After China's Markets Whipsaw, PMIs Next
By City Index (Fiona Cincotta)   |  Jun 23, 2020 04:18AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

After some whipsaw action in the Asian session as the White House’s stance on China was thrown into confusion, the waters have calmed, and European bourses are pointing mildly higher.

Trump was the saving grace, walking back on Trade Secretary Peter Navarro’s assertion that the trade deal with China was over. Trump swiftly contradicted the claim, saying that the China trade deal was “fully intact.”

There is no smoke without fire. Navarro is one of the most outspoken critics of China among Trump’s senior advisors. However, we know that relations between the US and China have been on a knife’s edge for a while. The market movements overnight show that they are still sensitive to US – Sino trade relations. There is a good chance that US – China trade relations could return to be a central focus in the second part of the year as the global economy recovers from the COVID-19 outbreak and as we head towards the US elections.

Reopening Optimism Overshadows Second Wave Fears

Concerns over a second wave of coronavirus infections remain, although Beijing has seen fewer new cases, lifting sentiment. However, Germany’s recent flare-up has seen the R rate push higher again.

Optimism surrounding the reopening of the UK economy is adding to the risk-on mood, with Boris Johnson expected to announce a reduction in the 2 meter rule, in addition to adding cinema’s, museums and galleries to the list of premises able to reopen on 4th July. Expectations of US and Spanish stimulus are also bolstering the mood in the market ahead of PMI data.

PMIs Expected To Show The Worst Has Past

Looking ahead, the focus shifts towards purchasing managers index data which will be released from the UK, Eurozone and the US providing a decent picture as to how the economic recovery is developing.

PMIs across the board are expected to confirm that April was the trough from the coronavirus economic catastrophe and that the recovery has been gathering pace ever since. Service sector and manufacturing sector PMI readings are expected to reveal that the pace of contraction slowed again in Jun. The data is also expected to show that activity in the sectors remains in contraction, with the service sector, which bore the brunt of the lockdown measures, lagging.

In the UK the manufacturing sector PMI is expected to increase to 45 in June, up from 40.7. The service sector is due to jump from 29 in May to 39.5 this month. A better than expected reading could boost the pound and keep risk sentiment buoyant, supporting stocks.

FTSE Chart
FTSE Chart

Europe Points Higher After China's Markets Whipsaw, PMIs Next
 

Related Articles

Tim Knight
Lemonade Sours By Tim Knight - Dec 03, 2021 2

Remember Lemonade Inc (NYSE:LMND)? The company that, at the start of this year, was worth more than IBM (NYSE:IBM)? Yeah, that Lemonade. The company none of us had heard of. Let’s...

Jani Ziedins
Why Bears Keep Getting It Wrong By Jani Ziedins - Dec 03, 2021 2

Surprise, surprise, the S&P 500 recovered from Wednesday’s massive intraday reversal. Okay, no one was really surprised because Thursday’s 1.4% bounce was the market’s third...

Europe Points Higher After China's Markets Whipsaw, PMIs Next

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email