Global PMI Scorecard (Sept 2011): Growth accelerating despite Eurozone sinking

 EmailPrint This Post Print This Post

Global economic activity accelerated in September despite the contraction in economic activity in the Eurozone. However, the global services sector saved the day as global manufacturing stagnated.

The increase in the JP Morgan Global Composite Index to 52.0 in September from 51.5 in August is attributed mainly to a jump to a solid increase in the U.K.’s PMI to 51.5 from 50.4 in August, while Markit’s composite PMI for China increased to 51.5 from 50.4. Although the composite PMI I calculate from CFLP’s manufacturing and non-manufacturing PMIs also increased from 54.9 in August to 56.1 in September, the seasonally adjusted PMI in my calculations actually fell to 52.9 from 53.8 in August. The easing of the contraction in Japan also contributed to the improvement in the JP Morgan Global Composite Index.

My GDP-weighted Composite ISM PMI for the U.S. in September came in unchanged from August’s 52.7, indicating continued but below-par growth. France and Germany’s composite PMIs indicate that growth in the two major economies in the Eurozone has stalled. Economic activity in the Eurozone as a whole has moved from growing to contracting, though, and indicates a significant contraction in the rest of the economic zone.

Economic activities in emerging economies are mixed. The contraction in Hong Kong and Brazil is quickening, while India’s expansion has slowed significantly. Russia is holding up reasonably well.

GDP-weighted/ Composite PMIDirection 


Rate of change

Eurozone****48.750.8ContractingFrom growing
Emerging Economies
China S/A**52.953.8GrowingSlower
India*50.254.5GrowingSlowed rapidly
Hong Kong*45.947.8ContractingFaster
Saudi Arabia*54.557.9GrowingSlower
JP Morgan Global Composite*  








Sources: *Markit; **CFLP, Li & Fung, Plexus; ***ISM, Plexus Asset Management; ****Markit, Plexus Asset Management.

The JP Morgan Global Services PMI for September rose to 52.6 from 52.0 with China leading the way, followed by the U.K. and the easing of the contraction in Japan’s services sector. Although the U.S.’s ISM non-manufacturing PMI was a tad lower at 53.0 from 53.3 in August, the business activity index rose markedly to 57.1 from 55.6.

The services sector in the Eurozone tanked, with the PMI sinking to 48.8 from 51.5 where a level below 50 indicates contraction. The fall-off in activity in the services sector in the economic zone was broad based and led by Germany, which moved from expansion to contraction. The contraction in Italy and Spain’s services sectors deepened, but Ireland managed to stay afloat and eke out some acceleration in growth. Worst hit was France, where the PMI fell 5.3 points to a still expanding 51.5.

Growth in Australia’s services sector lost momentum as the PMI fell to a virtually stagnant 50.3. Russia was a star among the BRICS countries as its services PMI edged up slightly to 53.3. India’s services PMI fell heavily from a solid expanding 53.8 to contraction, while Brazil’s PMI also fell to near stagnation levels.



Services PMI




Rate of Change

U.S.**53.053.3GrowingSlightly slower
U.S. BAI***57.155.6GrowingFaster
Eurozone48.851.5ContractingFrom growing
Germany49.751.1ContractingFrom growing
France51.556.8GrowingSlowed rapidly
Ireland51.351.1GrowingSlightly faster
Japan 46.444.3ContractingSlower
Australia 50.352.1GrowingSlower
Emerging Economies
China*59.357.6Growing, robustFaster
China S/A*57.056.0Growing, robustFaster
India49.853.8ContractingFrom growing
Russia53.353.2GrowingSlightly faster
JP Morgan Global Services  








Sources: Markit; CFLP*; ISM**; US Business Activity Index***; Plexus Asset Management.

Did you enjoy this post? If so, click here to subscribe to updates to Investment Postcards from Cape Town by e-mail.

OverSeas Radio Network

Leave a Reply

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>




Top 100 Financial Blogs

Recent Posts

Charts & Indexes

Gold Price (US$)

Don Coxe’s Weekly Webcast

Podcast – Dow Jones

One minute - every hour - weekdays
(requires Windows Media Player)
newsflashr network
National Debt Clock

Calendar of Posts

October 2011
« Sep Nov »

Feed the Bull