Investing.com - Here are the top five things you need to know in financial markets on Monday, July 3:
1. China’s factories unexpectedly return to growth
Caixin's China manufacturing purchasing managers’ index (PMI) registered a surprise expansion in June, offering hope the world's second-largest economy continues to defy expectations for a slowdown.
The private survey came in at 50.4, marking a three-month high. It was up from May's 49.6, which was an 11-month low, and beat consensus that had expected a drop to 49.5.
Levels above 50 signal an expansion, while levels below 50 indicate contraction.
2. Euro zone factories clock fastest growth in 6 years
Following the positive data out from China, factories in the euro area closed out the second quarter with their fastest rate of activity in six years while job creation remained near May’s record high.
IHS Markit's manufacturing PMI for the euro zone rose to 57.4 in June, up from May's 57.0 and pipping the preliminary reading of 57.3.
June's reading was the highest since April 2011 and was comfortably above the 50 level that separates growth from contraction.
The U.S. will have its own reading on activity with the ISM manufacturing PMI out at 10:00AM ET (14:00GMT).
3. Global stocks kick off third quarter with gains
Global stocks were broadly higher on Monday, starting off the third quarter on a positive note, as positive manufacturing data buoyed investor sentiment.
European shares all traded higher Monday as euro zone factory growth hit a six year high. At 5:58AM ET (9:58GMT), the European benchmark Euro Stoxx 50 gained 0.93%, the DAX rose 0.70%, the CAC 40 traded up 1.02% while London's FTSE 100 advanced 0.31%.
Earlier, Asian stocks closed mostly higher as a return to expansion for Chinese manufacturers boosted optimism.
U.S. futures pointed to a higher open, although trade will lightly be muted ahead of the Independence Day holiday. Wall Street will close its doors at 1:00PM ET (17:00GMT) Monday and will remain closed on Tuesday for the holiday. At 5:59AM ET (9:59GMT), the blue-chip Dow futures gained 0.28%, S&P 500 futures rose 0.29% while the Nasdaq 100 futures advanced 0.28%.
4. Oil slips despite decrease in U.S. drilling activity
Oil prices finally pulled back on Monday in early morning North American trade after seven consecutive days of gains.
That was despite the fact that energy services company Baker Hughes reported on Friday that the number of active U.S. rigs drilling for oil declined by two to 756 rigs at the end of last week, its first decrease since January.
Despite the dip in U.S. drilling, the total rig count was still more than double the 341 rigs in the same week a year ago and investors remain concerned about the overall impact on the global supply glut.
U.S. crude oil futures slipped 0.04% to $46.02 at 6:04AM ET (10:04GMT), while Brent oil fell 0.21% to $48.67.
5. Tesla gets green light for Model 3 production
Tesla’s high-volume Model 3 sedan passed all regulatory requirements for production two weeks ahead of schedule, Chief Executive Elon Musk tweeted on Sunday night.
Musk added that production was expected to grow exponentially with 100 cars in August rising to more than 1,500 in September and that the firm would be on track to reach 20,000 Model 3s per month by December.
Shares in Tesla (NASDAQ:TSLA) were up nearly 3% in pre-market trade Monday.