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All eyes will be on China tonight.”This week’s most closely watched data release will be Wednesday’s “flash” estimate of China’s manufacturing PMI for October,” according to Dave Lutz of Stifel Nicolaus.
At 9:45 PM EST, Markit will publish the HSBC Flash China Manufacturing Purchasing Managers Index (PMI).
This is a preliminary reading on the health of China’s manufacturing sector.
Everyone hopes it’ll confirm some recent signs of a pick up in China.
This past weekend, China reported that its GDP grew at a 7.4 per cent rate in Q3., which was right in line with expectations. However, September’s retail sales and industrial production figures beat expectations.
The weekend data dump had economists cheering.
- “Our overall take is that the 7.4% yoy GDP growth in 3Q could mark the trough,” said Bank of America’s Ting Lu.
- “If China were a football team, you might want to support them and/or wear their replica shirts. After months of debate about a ‘soft’ or ‘hard landing’, the data published since last Friday is very supportive of the optimists’ view,” said Goldman Sachs’ Jim O’Neill.
In his Sunday Start note, Morgan Stanley’s Joachim Fels wrote that he expects tonight’s number to show an uptick “consistent with green shoots theory.”
China is the second largest economy in the world and its most important source of growth.
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