FTSE 100 preview: Weak Chinese data to curb sentiment

on Sep 1, 2015
Listen

The FTSE 100 is expected to start this holiday-shortened week in negative territory after data showed China’s manufacturing sector to be in the grip of the worst slump seen in several years, raising fresh fears about the health of the world’s second-largest economy.

The London market was closed for a bank holiday yesterday. The UK benchmark index ended Friday’s session 0.9 percent higher and scored a one percent weekly gain, as blue chips managed to close out a wild week of trading across the globe on a positive note. According to trading platform IG, the Footsie is set to slump today, opening around 104 points lower at 6,143, with no scheduled corporate releases to provide direction.

Data overnight showed activity in China’s manufacturing sector fell at the fastest pace in three years last month, another signal that the country’s economy is losing momentum. The official manufacturing purchasing managers’ index (PMI) edged down to 49.7 in August from 50 in July, just below the 50-mark that separates expansion from contraction. Separately, the final Caixin/Markit manufacturing purchasing managers’ index (PMI) came in at 47.3 in August, above a preliminary reading of 47.1 but down from 47.8 in July.
Asian stock markets were down across the board today. By 07:04 BST, the MSCI’s broadest index of Asia-Pacific shares outside Japan had fallen 0.82 percent to 489.15, erasing its early gains. Meanwhile, Tokyo’s Nikkei 225 was 3.25 percent down at 18,276.78, as data showed that corporate capital expenditure had increased 5.6 percent in April-June from a year ago, slowing from the previous quarter and adding to signs of an economy struggling to recover from a slump.
Overnight, US equity markets closed in the red, ending the worst month since 2012. The Dow Jones Industrial Average shed 0.69 percent to 16,528.03, the S&P 500 fell 0.84 percent to 1,972.18, while the Nasdaq eased 1.07 percent, to 51.82.

Are you looking for signals & alerts from pro-traders? Sign-up to Invezz Signals™ for FREE. Takes 2 mins.

Ad

Want easy-to-follow crypto, forex & stock trading signals? Make trading simple by copying our team of pro-traders. Consistent results. Sign-up today at Invezz Signals.

Learn more
Indices Stock Market