Thursday’s PMI Manufacturing numbers were not as discouraging as anticipated. For all its stagnation and QE measures, I must admit that the EU it is flashing some signs of economic recovery. This is especially noteworthy given the fact that the Brexit event has come and passed and the sky has not fallen from the heavens to rain financial Armageddon across the continent as predicted. Three out of four positives is a passing grade in anyone’s book. Besides, France will always be France.
- Germany’s Manufacturing PMI for August-2016 remains quite robust @ 53.6 and matched expectations while coming in just slightly lower @ 53.8.
- Britain’s Manufacturing PMI for August-2016 indicates so far that Brexit concerns may have been overdone. The indicator hit a 10-month high @ 53.3 and easily beat consensus @ 49.0 and prior revised @ 48.3.
- France’s Manufacturing PMI @ 48.3 for August-2016 was slightly under consensus @ 48.5 and prior @ 48.6.
- Global Manufacturing PMI for August-2016 declined incrementally to 50.8 vs. prior @ 51.0.
Switching over the market’s response to this data, I have been monitoring the Vanguard European Equity ETF (VGK) which has lagged most other countries for quite some time. This week, it finally showed some pluck and appears to be consolidating after recently crossing above its bearish channel. Bear in mind (no pun intended, haha) that is this is a very early call, but if VGK can surmount resistance at the $51 price level, then technically there is not much standing between it along the path to a target @ $58. Keep this one on the radar!