Investor sentiment in China reflected the final reading of Caixin’s Purchasing Managers’ Index (PMI), which came in at 47.8 for July.
Advertisement
The index remained above the 50 threshold that separates expansion from contraction for the third consecutive month. Factories also had to reduce selling prices to a six-month low due to increasing competition, squeezing profit margins.
Caixin’s China PMI data tends to focus on smaller and medium-sized companies, filling a niche that isn’t covered by the official data.
Bloomberg News reported Iranian Oil Minister Bijan Namdar Zanganeh as saying output could increase by 500,000 barrels a day within a week after global sanctions are eased and by one million barrels a day within a month after that.
China’s stock markets have been extremely volatile in recent weeks – but the impact on the real economy should be limited.
China’s slowdown is also forcing many Western companies to take a hard look at their businesses there, leading many to reduce investments and costs. “Currently, in China we had negative order intake”, Frans van Houten, chief of Dutch electronics group Philips NV said last week. What has it achieved if China’s growth driver remains with the investment sector?
Greece’s manufacturing sector was absolutely trashed in July, as capital controls were introduced and bailout negotiations reached their dramatic climax – Markit’s latest survey of Greek industrialists confirms that firms have seen their output collapse.
Markit economist, Amy Brownbill, said the data indicated worsening operating conditions faced by Malaysian manufacturers as production declined further, alongside a marked contraction in new orders due to weak domestic demand.
Worries about slowing demand from China, a glut of supply and a stronger U.S. dollar continues to batter commodities markets.
Advertisement
Chinese have relatively little money invested in the stock market. Purchasing activity continued to rise in July, although the rate of growth was slightly weaker than in the previous month. Beijing has a 2015 growth target of “around 7%”.
