Global stocks and oil hit three-month highs on strong China services survey – business live | Business


Hello and welcome to our continued coverage of the global economy, financial markets, the eurozone and business

Markets continue to benefit from a wave of economic optimism, spurred by a solid survey of the service sector in China, which peaked at almost 10 years last month.

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Le Caixin China the Purchasing Service Managers' Index (PMI), a private survey, jumped to 55.0 in May from 44.4 in April, above the 50 mark separating the expansion of the contraction after falling below 50 for three months due to the coronavirus pandemic.

This is the highest record since the end of 2010. New orders also registered their largest increase since September 2010, as demand from China picked up. The service sector accounts for about 60% of the Chinese economy.

This has boosted the stock markets in Asia and is also expected to spread to Europe. The Japanese Nikkei reached its highest level since February and closed up 1.29%, while the Hang Seng in Hong Kong rose by 1.32% and the Kospi in South Korea by 2.87%. .

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The value of MSCI shares around the world rose 0.3%, reaching a three-month high and bringing the gain from its trough on March 23 to almost 36%.

Here, the FTSE 100 index in London is expected to open 60 more points and the German Dax is called 125 more points.

Global stocks have so far ignored growing unrest in the United States after the murder of George Floyd, as well as latent trade tensions between the United States and China. Despite protests sweeping across the statesWith nighttime curfews and President Donald Trump calling on the military to intervene, the US markets closed at their highest level in three months yesterday.

Oil prices are also recovering, Brent crude, the world benchmark, rising 1.84% to $ 40.30 a barrel. Earlier, it hit $ 40.53, the highest since early March, after gaining 3.3% on Tuesday. US light crude rose 2.7% to $ 37.82 a barrel. Oil prices have risen in recent weeks due to the growing evidence that the Chinese economy is recovering from the Covid-19 pandemic and easing of blockages around the world. This suggests a recovery in demand for oil.

On the economic front, this morning we will get final service readings and composite PMI surveys from the euro area and the UK, as well as unemployment rates for Germany, the EU and the euro zone.

Michael Hewson, Chief Market Analyst at CMC Markets, says:


The greatest concern remains in Spain and Italy, which depend so much on tourism in their service sector, and whose recovery is likely to be slow and painful, as tourists stay away. Recent figures for France, Germany and the United Kingdom have improved from a record low in April to 29.4, 31.4 and 27.8 respectively.

The agenda

  • 8:15 a.m. to 8:55 a.m.BST Spain / Italy / France / Germany Markit and PMI composite final services (May)
  • 8:55 a.m. BST: German unemployment rate (April) (forecast: 6.2%)
  • 9h BST: Markit final services from the euro zone and composite PMI (May) (forecast: 28.7 / 30.5)
  • 9:30 am BST: Markit Final services in the United Kingdom and PMI composites (May) (forecast: 28 / 28.9)
  • 10am BST: unemployment rate in the euro zone (April) (forecast: 8.2%)
  • 1:15 BST: American report on ADP payroll
  • 2:45 p.m. BST: US Markit Final and PMI composite services (May) (forecast: 36.9 / 36.4)
  • 3:00 p.m. BST: PMI US ISM non-manufacturing (May) and factory orders

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