Happy New Year

January 2, 2012

New Year’s Day is the most widely shared holiday.  Typically, markets are quite on this second day of January with many centers closed to observe the holiday.  However, many manufacturing purchasing manager surveys were published, and these showed depressed conditions in Continental Europe but some pleasant surprises elsewhere.

The dollar rose 0.3% against sterling, 0.2% relative to the Swissie, and 0.1% versus the euro, Aussie dollar and kiwi.  The yen firmed 0.1% against the greenback, while the loonie and yuan are steady against the U.S. currency.

In Asia, share prices rose 0.4% in India but fell by 1.7% in Taiwan, 0.6% in Pakistan, and 0.3% in Indonesia.  South Korean equities are unchanged.  In Europe, the German Dax and Paris Cac jumped by 2.1% and 1.2%.

Ten-year German bund yields rose six basis points.

The final measure of Euroland’s factory PMI in December printed at 46.9, same as the flash indication and 0.5 points better than November’s 28-month low.  Manufacturing appears to have contracted some 1.5% last quarter.

  • The German PMI was revised up by 0.3 points to 48.4 and showed slower contraction than in November when such was at 47.8.
  • The French index of 48.9 was a 4-month high after readings of 47.3 in November and 48.5 in October.
  • The Greek index climbed 1.1 points but at 42.0 signaled continuing substantial recession.
  • Italy’s PMI scored a 44.3 after 44.0 in November.  The index has been below the breakeven line of 50.0 since August.
  • The Dutch survey also produced a significant sub-50 result of 46.2, albeit 0.2 points above November’s 2-1/2 year low.
  • Spain’s PMI dipped 0.1 point to 43.7, lowest since September.

India’s PMI in manufacturing improved impressively to 54.2 from 51.0 in November and a 30-month low of 50.4 in September.

Taiwan’s PMI had a 47.1 reading after 43.9 in November, 43.9 in October and 43.7 in September.

The South Korean PMI weakened further to 46.4 in December from 47.1 in November and 48.0 in October.

Sweden’s PMI improved 1.3 points but remained under 50 at 48.9.  Denmark’s PMI leaped to an 8-month high of 59.8 from 48.6.

In Eastern Europe, Hungary’s PMI rose 0.7 points to 48.5 and exceeded expectations.  The Czech index rose 0.6 points to 49.2, but Poland’s reading of 48.8 was 0.7 points less than the November score.

Norwegian house prices firmed 0.5% in December and retained a 12-month increase of 8.5%.

India’s trade deficit narrowed 30% on month to $13.6 billion in November.

Several other PMI scores will be reported Tuesday, including those of the United States, Britain and Australia.

Copyright 2012, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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