Investing.com - Here are the top five things you need to know in financial markets on Monday, April 1:
1. China Manufacturing Activity Rebounds
China's manufacturing sector unexpectedly returned to growth for the first time in four months in March, in a sign that stimulus injected into Asia's growth engine may be yielding results.
The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 50.8 from 49.9 in February. That was the strongest reading in eight months.
Gains for the private gauge came on the heels of China’s official manufacturing PMI released on Sunday, which rose to a six-month high of 50.5 from 49.2.
The data suggested China's ailing manufacturing sector is on a path to recovery, easing fears the world's second-largest economy could slip into a sharper economic downturn.
2. Eurozone Factory Data Underwhelm
In contrast, factories in the euro zone had their worst month in almost six years in March and forward-looking indicators pointed to gloomy times ahead.
IHS Markit's March final manufacturing Purchasing Managers' Index declined for an eighth month, coming in at 47.5 from February's 49.3, just below a flash estimate and its lowest reading since April 2013.
An index measuring output change - seen as a good gauge of economic health - sank to 47.2 from 49.4, its lowest since April 2013.
In a worrying sign, Germany's manufacturing sector contracted at its fastest rate since July 2012, while new orders posted their steepest drop since April 2009.
The euro was at $1.1240 by 5:40AM (09:40 GMT), not far from a three-week low of $1.1210 that it brushed on Friday.
3. U.S. Retail Sales, ISM Coming Up
This week's economic data should bring further clarity on whether the economy is losing steam or just stumbling through a soft patch.
The Commerce Department will release retail sales figures for February at 8:30AM ET (12:30 GMT). The consensus forecast is that the report will show retail sales inched up 0.3%, following a gain of 0.2% in January and December’s shocking decline. Excluding the automobile sector, sales are expected to have risen 0.4%, after climbing 0.9% in January.
Later, the U.S. Institute of Supply Management will release its monthly survey on manufacturing sector activity at 10:00AM ET (14:00 GMT). Economists expect a reading of 54.2, unchanged from the previous month.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was down 0.2% at 96.64, after going as high as 96.91 on Friday, its strongest since March 13.
In the bond market, the yield curve between 3-month U.S. Treasury bills and 10-year notes turned positive again, a symbolic change that appeared to help boost market participants' confidence.
4. Dow Futures Point to Triple-Digit Gains
U.S. stock futures pointed to a higher open, with the Dow set for a triple-digit gain following the surprisingly strong Chinese factory data.
The blue-chip Dow futures were up 183 points, or about 0.7%, the S&P 500 futures rose 18 points, or around 0.7%, while the tech-heavy Nasdaq 100 futures indicated a gain of 71 points, or roughly 1%.
Elsewhere, European stocks jumped in mid-morning trade, with all major bourses across the continent in positive territory. Among national indices, Germany's DAX was up 1.2%.
Earlier, shares in Asia closed broadly higher, with the Shanghai Composite gaining more than 2%.
5. Oil Hits 2019 High
In commodities, the Chinese data also lifted crude oil prices to their highest level in nearly five months.
U.S. West Texas Intermediate crude futures were up 58 cents, or around 1%, at $60.72 a barrel, a level not seen since November 12. Prices have also been supported by a sixth straight weekly drop in the number of drilling rigs in use in the U.S.. They're now down nearly 8% since the start of the year, a reflection of greater caution among shale drillers in response to the year-end slowdown in the economy.
International Brent crude oil futures were at $68.61 per barrel, up $1.03, or roughly 1.5%.
Crude prices have been well-supported in recent weeks amid signals that OPEC-led production cuts as well as U.S. sanctions against Iran and Venezuela have helped tighten an oversupplied market.
Read more: Commodities Quarter Ahead: Oil Eyes $70, Gold Bugs $1,400 In Q2 Ambitions: Barani Krishnan
-- Reuters contributed to this report