banner

Ticker

* Cotações com atraso superior a 15 minutos via Bats CHI-X Europe e NASDAQ Basic

PATRIS - MACRO - Eurozone: Markit composite PMI declines in November and suggests that the economy may not rebound in 4Q18

26 Nov 2018

noticias/noticia3.jpg

Bottom-Line: The Markit composite PMI fell 0.7 points in November to 52.4, according to the preliminary reading released this morning (vs. consensus 53.0). This is the lowest value since the end of 2014. The October/November average stands at 52.8, after 54.3 in 3Q18, suggesting that the region will probably continue to show a weak pace of expansion in the last quarter of 2018 (see chart). The manufacturing PMI for the region fell by 0.5 points to 51.5 (vs. consensus 52.0). The survey brought further signs that the slowdown is broadening out beyond manufacturing, as the services PMI (-0.6 points to 53.1, vs. consensus 53.6) fell to the lowest level since October 2016.

New business inflows slowed to the lowest level since the start of 2015. Manufacturers continued to mention sluggish car sales, amongst other headwinds. New business inflows in the service sector hit a 25-month low. Employment growth slowed in both sectors, dropping to a 22-month low. Input cost inflation remained slightly higher than the average recorded so far this year, reflecting energy, raw materials and staff costs. Output price inflation remained elevated and unchanged in October, albeit down from highs earlier in the year. However, manufacturing prices showed one of the smallest increases over the past year.

The limited breakdown by countries showed the composite PMI for Germany falling to a near four-year low, with the services PMI declining by 1.4 points on the month. Especially sluggish was probably growth in the euro area excluding Germany and France, with Markit saying that the rate of expansion was the slowest since November 2013, easing in both sectors to register only modest expansions.

etails:

France: Markit composite PMI fell by 0.1 points to 54.0 in November (vs. consensus 53.9), according to the preliminary data released this morning, reflecting declines in both manufacturing (-0.5 points to 50.7, vs. consensus 51.2) and services (-0.3 points to 55.0, vs. consensus 55.0). The October/November average stands at 54.1 for the composite PMI, which compares to 54.4 in 3Q18. The composite PMI remains near its lowest level in close to two years.

The details of the survey showed manufacturing production contracting for the second month running, albeit marginally (with anecdotal evidence suggesting falling demand particularly for autos). The new business component for the French private sector softened to a four-month low, due to a further contraction in the manufacturing sector (with reports of weakness in auto demand) and a slower expansion in services. The employment component in manufacturing fell into contraction territory (albeit marginally), for the first time since October 2016. In the service sector, the employment component remained in expansionary territory, although the reading was the lowest in 15 monthsOn prices, the rate of inflation in input costs eased to a three-month low (despite the steepest rise in costs since February recorded in manufacturing). Output charges rose again in November but remained at a modest level. Finally, confidence towards the 12-month business outlook declined to a two-year low (the lowest level since November 2016 in services and a 29-month low in manufacturing).

Germany: The Markit/BME composite PMI fell by 1.2 points in November to 52.2 (vs. consensus 53.1). This is the lowest reading since the end of 2014. The manufacturing PMI fell by 0.6 points to 51.6 (vs. consensus 52.2), a 32-month low, while the services PMI declined by 1.4 points to 53.3 (vs. consensus 54.5). The October/November average for the composite PMI stands at 52.8, after 55.2 in 3Q18, suggesting a new slowdown in the pace of GDP growth for the German economy in 4Q18

New order growth eased closed to stagnation, amid a further decrease in new exports. In manufacturing, order books fell for the second month runningand to the greatest extent in four years. The rate of inflation of charges for goods and services eased to a six-month low, though still remained elevated by historical standards. The employment component for the German private sector reached the lowest level since May (albeit still well above the long-run series average). Confidence towards the year-ahead outlook fell to the lowest in almost four years, reflecting concerns towards geopolitical tensions, weakness in the automotive sector and cooling market demand.

--------------------------------------------------------------------------------------------------------------------------------------------------------

For further information, or to receive the PDF file, please contact +351 912 897 835 or research@fincor.pt

Disclaimer

The information and opinion contained in this report was prepared by PATRIS - SOCIEDADE CORRETORA, SA ("Patris"), which is part of the group of companies whose holding is PATRIS INVESTIMENTOS, SGPS, SA (Patris Group), listed in Alternext, which holds 100% of the share capital and voting rights of REAL VIDA SEGUROS SA which, in turn, holds 100% of the share capital and voting rights of Patris.

The information contained herein is based on publicly available data obtained from sources believed to be reliable and has not been subject to independent verification. To the extent permitted by applicable law, Patris does not expressly or impliedly guarantee the accuracy, completeness and / or correctness of such data, or any omission. This document, or part thereof, may not be (i) modified, (ii) transmitted or distributed or (iii) copied or duplicated by any means or means, without the prior written consent of Patris.

The analysts involved in the preparation of this report did not receive, receive and will not receive any compensation, direct or indirect, based on the information contained in this report.

PATRIS - SOCIEDADE CORRETORA, SA or another company of the Patris Group or its respective shareholders, management, and / or employees may carry out personal transactions on the securities referred to in this report, at any time and without prior notice.

Any opinion contained in this report may be outdated as a result of changes in market conditions, applicable laws and other factors. It should also be considered that the analyst may make changes to the estimates, assumptions and evaluation methodology used.

This report has been prepared for information purposes only, not taking into account the specific investment goals, financial situation and particular needs of any specific person who may receive the report. This report therefore has no specific recipient.

Patris is subject to high internal standards of behavior associated with the capital market, prepared on the basis of the applicable legislation of the Portuguese State and the European Union, which include rules to prevent and avoid conflicts of interest and barriers to the disclosure of information.

Investors should bear in mind that the rate of return on the securities identified in this report - if any reference is made to those returns - may vary and the price of such securities may rise or fall. Investors should thus be aware that they may receive less than initially invested. While this report may refer to the historical performance of securities, past performance is no guarantee of future performance. In addition, market conditions, applicable laws and other factors that have an effect on performance are all likely to change, with the consequent change in the information contained in this report. Patris or any other company of the Patris Group does not accept, to the extent permitted by applicable law, any liability, whether direct or indirect, resulting from losses that may arise due to the use of the information contained in this report.

Patris's activity is overseen by the Bank of Portugal and the Securities Market Commission. 

Voltar