The European markets tanked on Friday after the Eurozone’s manufacturing sector appeared to take another nasty turn in March.
Across the board the flash PMIs were an eyesore, uniformly coming in worse than forecast and sinking even further into contraction territory. The German figure was especially alarming, arriving at 44.7 against the 48.0 estimated by analysts and the 47.6 seen last month, as Brexit, trade tensions between the US and China, and issues in the car industry all came to weigh heavy on the sector. The services PMIs was a tad better, though the French reading did narrowly, and unexpectedly, slip under 50.0.
Once again presented with an ugly picture of the Eurozone economy, both the region’s indices and the euro itself took a sharp tumble. The single currency shed half a percent against the dollar and 0.9% against the pound, while the DAX and CAC plunged 0.4% and 0.9% respectively, swiftly undoing the growth managed at the start of the session.
As for the FTSE, the UK index found itself even worse off, back below 7300 after dropping 1% thanks to a reversal from its commodity stocks, and the pound’s rebound following Thursday’s Brexit extension drama in Brussels. On top of its 0.9%, €1.162-teasing surge against the euro, sterling added 0.4% against the dollar, pushing cable towards $1.3145.
Looking to the afternoon session, and following yesterday’s 1% surge the Dow Jones is set to pull back by 100 or so points when the bell rings on Wall Street, the US index as present struggling to find a reason to continue Thursday night’s rally.
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