Market Reports

In the US, the S&P Global US Manufacturing PMI increased to 50.7 in January 2024 from 47.9 in December 2023, reaching its highest level since September 2022 and indicating marginal improvements in the manufacturing sector. This improvement was attributed to an expansion in new orders and a slower decrease in output. Concurrently, the S&P Global US Services PMI rose to 52.5 in January 2024 from 51.4 in December 2023, marking continuous robust growth in the services sector over seven months, driven by an increase in new orders due to stronger domestic demand and the most significant rise in new export orders since August 2023. Furthermore, the University of Michigan’s consumer sentiment index in the US climbed to 79.0 in January 2024 from 69.7 in December 2023, lifted by positive perceptions of inflation control and enhanced income prospects. Inflation expectations for the upcoming year dropped to 2.9%, the lowest since December 2020, from 3.1%, and the outlook for the next five years slightly declined to 2.8% from 2.9%.

In Europe, the HCOB Eurozone Manufacturing PMI increased to 46.6 in January 2024 from 44.4 in December 2023, indicating a slight improvement in the manufacturing sector despite a decrease in manufacturing output for the tenth consecutive month. This decrease was the smallest observed since April of the previous year. Additionally, the decline in new orders for goods was the least pronounced in nine months, and the reduction in exports was also less severe. Conversely, the HCOB Eurozone Services PMI decreased to 48.4 in January 2024 from 48.8 in December 2023, marking the sixth consecutive month of contraction in the services sector. This downturn was characterized by a continued drop in new business for the seventh month, highlighting weak demand conditions exacerbated by high borrowing costs and subdued consumer appetite. Furthermore, the Euro Area’s consumer confidence indicator declined by 1 point to -16.1 in January 2024, suggesting a cautious outlook among consumers.

In Japan, The au Jibun Bank Japan Manufacturing PMI slightly increased to 48.0 in January 2024 from 47.9 in December 2023, marking the eighth consecutive month of decline in factory activity. This period saw a sustained fall in output, which was, however, the softest in three months. Both new work and export sales continued to shrink for the eighth month, with demand from China and the Asia-Pacific region declining. Conversely, The au Jibun Bank Japan Services PMI rose to 53.1 in January 2024 from 51.5 in December 2023, indicating the seventeenth consecutive month of expansion in the service sector at the fastest pace since September. This expansion was driven by a quicker increase in new business inflows and the first growth in foreign demand in five months, aided by a weakening yen. The sector also benefited from continuous improvements in tourism, contributing to the seventeenth consecutive month of new business growth. Additionally, the consumer confidence index improved to 38.0 in January 2024 from 37.2 in December 2023, reaching its highest level since December 2021.

In the US, the S&P Global US Manufacturing PMI experienced a decline to 47.9, signaling a significant contraction in the manufacturing sector due to reduced output and declining orders amid weakened domestic and external demand. Conversely, the S&P Global US Services PMI rose to 51.4 in December 2023 from 50.8, marking the most significant expansion in five months. This growth was driven by a surge in new orders and improved sales conditions. Concurrently, the University of Michigan’s Consumer Sentiment Index improved to 69.7, its highest in five months, indicating growing consumer optimism, particularly in their perception of inflation’s trajectory.

In Europe, the HCOB Eurozone Manufacturing PMI remained almost static at 44.4, a slight increase from 44.2, but still indicative of the sector’s ongoing contraction, marked by persistent output and job losses for the seventh month in a row. Similarly, the HCOB Eurozone Services PMI barely shifting, standing at 48.8 compared to 48.7 previously, signaling a fifth consecutive month of contraction. This was attributed to a decline in demand for services towards the year’s end and a significant slowdown in employment growth. Additionally, a continued reduction in backlogs of work since last July highlighted sustained pressures. However, the consumer confidence indicator in the Euro Area experienced a modest uptick, rising 1.9 points to -15 in December, the highest level seen since February 2022, suggesting a glimmer of optimism amid prevailing economic challenges.

In Japan, the au Jibun Bank Japan Manufacturing PMI declined to 47.9 from 48.3, marking the seventh consecutive month of contraction. This represented the sharpest decline since February, largely attributed to market uncertainties that adversely affected new orders and led to a further reduction in output. Additionally, the sector faced a significant decrease in foreign sales, experiencing the most substantial drop in six months, driven by reduced orders from key export markets such as China, Europe, and North America. In contrast, the au Jibun Bank Japan Services PMI increased to 51.5 from 50.8, continuing a 16-month trend of growing business activity. However, this expansion was modest, ranking as the second-weakest in 2023. New orders in services saw notable growth, mainly driven by domestic demand, though foreign demand experienced a slight decline for the third consecutive month. Employment in the services sector improved, marking a third month of growth, albeit at a modest rate. The consumer confidence index climbed to 37.2 in December 2023 from 36.1, reaching its highest point since December 2021.

In the US, the S&P Global US Manufacturing PMI experienced a decline, dropping to 49.4 in November 2023 from 50.0 in October, its lowest in three months, indicative of a slight contraction in the manufacturing sector. This downturn was largely driven by a decrease in new orders, impacting production and employment levels in the sector. In contrast, the S&P Global US Services PMI displayed a positive trajectory, rising to 50.8 in November from 50.6 in October, the highest in four months, suggesting a continued expansion in the services sector. This growth was fueled by increased output, new business activities, and strengthened customer demand, including a rise in international business. However, the University of Michigan Consumer Sentiment Index recorded a decline, falling to 61.3 in November from 63.8 in October, marking its fourth consecutive month of decrease. This decline in consumer sentiment was primarily attributed to uncertain expectations about future business conditions, despite some improvements in perceptions of current personal finances.

In Europe, the HCOB Eurozone Manufacturing PMI showed a slight improvement, rising to 44.2 in November 2023 from 43.1 in October, marking the highest level since May. However, this figure still represents the seventeenth consecutive month of contraction in the manufacturing sector, with Austria, Germany, and France experiencing the most significant declines. Manufacturing output continued to decrease, albeit at a slower rate, alongside declines in both new orders and export sales. Similarly, the HCOB Eurozone Services PMI also increased, reaching 48.7 in November, up from 47.8 in October. Despite this increase, the services sector continued to show a decline in activity, a trend that has persisted since August. The slowest pace of decline in new business for three months partially offset this downturn, although backlogs of work continued to fall. In a slightly more positive development, the consumer confidence indicator in the Euro Area rose to -16.9 in November, up 0.9 points from the previous month and the highest in three months. This uptick in consumer confidence is attributed to optimism surrounding the stabilization of interest rates and the potential for their decrease, buoyed by the slowing down of inflation.

In Japan, the au Jibun Bank Japan Manufacturing PMI fell to 48.3 in November 2023 from 48.7 in the previous month, marking the sixth consecutive month of contraction in the manufacturing sector. This decline was the most significant since February, driven by accelerated decreases in output, new orders, and a particularly sharp drop in new export orders, the fastest decline since June. Conversely, the au Jibun Bank Japan Services PMI also experienced a downturn, decreasing to 50.8 from 51.6 in October. This represented the softest growth in the services sector since December 2022 and was the fifth instance of easing in the past six months. Despite this, new orders in the services sector continued to grow at a steady pace, albeit modest compared to earlier in 2023, leading to an increase in outstanding business. Additionally, the consumer confidence index in Japan showed a slight improvement, rising to 36.1 in November 2023, the highest level since August.

In the US, the S&P Global US Manufacturing PMI recorded a slight improvement at 50.0 in October from 49.8, signaling stabilization in the manufacturing sector, driven by the first increase in new orders in six months and a modest acceleration in output growth. Similarly, the S&P Global Services PMI for the US rose to 50.6 in October from 50.1, indicating a modest expansion in the service sector, attributed to early signs of demand recovery and increased capacity. Meanwhile, the University of Michigan Consumer Sentiment Index declined sharply to 63.8 from 68.1 in September, its lowest level since May, partly due to unfavorable domestic and international events.

In Europe, the HCOB Eurozone Manufacturing PMI for October 2023 recorded a reading of 43.1, a decline from September’s 43.4. This marked the sixteenth consecutive month of contraction in the Eurozone’s manufacturing sector, with this decline being the sharpest in three months. Notably, new orders, purchasing activity, and backlogs all contracted significantly and rapidly, leading to a pronounced decrease in factory production. Additionally, the HCOB Eurozone Services PMI dropped to 47.8 in October from 48.7 in September, signifying the third consecutive month of declining services sector activity and the most profound contraction since February 2021. Demand conditions worsened as new business volumes fell at the quickest pace since January 2021, with a notable impact from non-domestic customers, as indicated by new export business declining at the fastest rate in over two-and-a-half years. Concurrently, the consumer confidence indicator in the Euro Area stood at -17.9 in October 2023, down from -17.8 in the previous period, marking its lowest point in seven months.

In Japan, the au Jibun Bank Japan Manufacturing PMI for October 2023 reported a figure of 48.7, a slight uptick from September’s 48.5. However, this marked the fifth consecutive month of decline in factory activity, with both output and new orders continuing to contract. This prolonged contraction has persisted for five months, following a brief period of marginal growth in May. Notably, foreign sales saw their most substantial decline since June, with China playing a pivotal role in reduced overseas orders. Simultaneously, the au Jibun Bank Japan Services PMI dropped to 51.6 in October 2023 from September’s 53.8, marking the 14th consecutive month of growth in the service sector but also the lowest reading since December 2022. New orders in the services sector expanded at the slowest pace in nine months, and orders from abroad declined for the first time in 14 months. Meanwhile, Japan’s consumer confidence index increased to 35.7 in October 2023, rebounding from September’s six-month low of 35.2.

In the US, the S&P Global US Manufacturing Purchasing Managers’ Index (PMI) rose to 49.8 in September 2023, up from 47.9 in August 2023. Although the sector registered its fifth consecutive month of contraction, the decline was fractional. The rate of output improvement was marginal but represented the fastest growth since May 2023. Conversely, the S&P Global Services PMI in September 2023 decreased to 50.1 from 50.5 in the previous month. This figure marks the slowest expansion in business activity over the last eight months. Contributing factors included a substantial decline in new business, which was attributed to inflationary pressures and recent interest rate hikes impacting customer purchasing power. Additionally, there was a marginal contraction in new export orders from the service sector, which led to a slight decrease in overall foreign client demand. The University of Michigan’s consumer sentiment index reported a decline, moving from 69.5 to 68.1 month-over-month.

In Europe, the HCOB Eurozone Manufacturing Purchasing Managers’ Index was reported at 43.4 in September 2023, a little changed from the prior month’s 43.5. This marks the fifteenth consecutive month of contraction for the Eurozone’s industrial sector. Contributing to this prolonged contraction were notably sharp reductions in new order inflows, ranking among the most severe declines in the survey’s 26-year history, along with a faster rate of decrease in output levels. On the services front, the HCOB Eurozone Services PMI for September 2023 increased to 48.7 from 47.9 in August 2023. Despite this marginal improvement, the sector recorded its second month of contraction this year. The downturn was primarily fueled by the most severe contraction in new business since the onset of the COVID-19 pandemic. This suggests a more significant transmission impact from the European Central Bank’s higher interest rates. Consumer confidence in the Euro Area continued its decline, falling to -17.8 in September 2023 from -16 in August 2023. This downward trend was particularly highlighted by consumers’ reduced willingness to engage in major purchases.

In Japan,  the au Jibun Bank Japan Manufacturing Purchasing Managers’ Index declined to 48.5 in September 2023 from 49.6 in the preceding month. This signifies the fourth consecutive monthly contraction in manufacturing activity, marking the fastest pace of decline since February 2023. Output registered its steepest drop in three months. Additionally, the rate of decline in new orders accelerated to its sharpest level in seven months. Export orders remained weak, particularly reflecting reduced sales to China. Furthermore, the au Jibun Bank Japan Services PMI for September 2023 decreased to 53.8 from 54.3 in August 2023. Although this marks the thirteenth successive month of expansion in the services sector, the rate of growth softened to its lowest level since January 2023. New business inflows moderated, and for the first time in 13 months, foreign demand contracted. Consumer confidence in Japan further weakened, falling to a six-month low of 35.2 in September 2023 from 36.2 in August 2023, and down from July’s 19-month high of 37.1.

In the US, the S&P Global Manufacturing PMI for August 2023 decreased to 47.9 from 49.0 in July, continuing the contraction trend observed since November 2022 with a brief exception in April. The decline was led by a fall in new orders and reduced output, while employment growth in the sector reached its lowest pace since January 2023. Concurrently, the S&P Global Services PMI registered at 50.5, down from 52.3 in the previous month. The reduction was largely attributed to diminished new business impacted by interest rate hikes and inflation. Employment growth in the services sector was the slowest in nearly a year. Additionally, the University of Michigan consumer sentiment index experienced a marginal decline, moving to 69.5 from 71.6 in July, indicating a relatively stable economic outlook compared to the prior month but an improvement over the last quarter.

In Europe, the HCOB Eurozone Manufacturing PMI rose to 43.5 in August 2023 from July’s 38-month low of 42.7, although the figure still indicates a challenging environment in the manufacturing sector. New orders and export business contracted at record rates, backlogs were notably reduced, and factory employment decreased for a third consecutive month. Simultaneously, the HCOB Eurozone Services PMI declined to 47.9 from 50.9 in July, representing the year’s first and most significant contraction in service sector activity, led predominantly by France and Germany. New business volumes decreased at the fastest rate since February 2021, and the level of incomplete business also fell substantially, leading to more cautious hiring practices. The Euro Area’s consumer confidence indicator slipped to -16 in August from -15.1 in July, marking its first decline since the previous September.

In Japan, the au Jibun Bank Japan Manufacturing PMI remained at 49.6 for August 2023, marking the third consecutive month of contraction in factory activity. Output levels and new orders continued to decline, albeit at softer rates, while foreign demand saw its least reduction in 13 months. Employment in manufacturing expanded at its slowest rate in 29 months, despite a decline in outstanding business for the 11th month. In contrast, the au Jibun Bank Japan Services PMI increased to 54.3, up from 53.8 in July, denoting the fastest growth in the service sector since May. The expansion was driven by an increase in new orders and moderate job creation, even as new businesses from abroad grew at a softer pace. Consumer confidence dropped unexpectedly to 36.2 in August from a 19-month high of 37.1 in July.