Signs of recovery after a difficult year sounded around the World Monday as manufacturers reported rising output and improved employment prospects in the USA, EuroZone and across Asia. From Bangkok to San Francisco, manufacturing sentiment has recovered quickly from the global recession last year, when World trade stopped dead and unsold inventories piled up in warehouses around the World. A year later, manufacturers reported that in October, output around the World was rising at the fastest rate in 5 years. The JPMorgan global composite purchasing managers’ index (PMI) rose to 54.4, up from 53 in September, the highest value since July 2004. The biggest surprise came in the USA, where the Institute for Supply Management’s factory index rose to 55.7 from 52.6 in September. The figure, well above market expectations, sent stocks in the USA and Europe North as it was seen as evidence that the recovery was stronger than previously thought. At the close of trading in Europe, the Eurofirst 300 index of European shares was 0.39% higher at 980.28, while the FTSE 100 index rose 1.2% to 5,105. The S&P 500 was up 0.7%. More encouraging than the stock market reaction for the USA was that the employment component of the ISM figures jumped from 46.2 in September to 53.1 in October, the highest reading since early 2006.
-Paul A. Ebeling, Jnr. www.livetradingnews.com
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