The economic Super Bowl just ended. And we lost.
First the scoreboard:
Dow: 12,118, -274.8, -2.2%
S&P 500: 1,278, -32.2, -2.4%
NASDAQ: 2,747, -79.8, -2.8%
And now the top stories:
- Countries around the world published their May manufacturing PMI reports. The most closely watched reports came from China. The official PMI number fell to 50.4, missing expectations for a more modest decline to 52. The HSBC China Manufacturing PMI report fell to 48.4, which was worse than the preliminary figure of 48.7. HSBC noted that employment fell at the fastest rate in 38 months. Asian markets, U.S. futures, and the Aussie dollar immediately tanked. SEE ALSO: The Jobs Situation In 22 Major Countries >
- Spain, Italy, France, Germany, and Greece all reported manufacturing PMI numbers below 50, which signals contraction in the industry. No one was really surprised. However, the big disaster came out of the UK, which reported a PMI number that dove to 45.9 from 50.2 in April. This was well below the 49.7 expected by economists. The market sell-off deteriorated sharply on the tail of the UK report. SEE ALSO: How The Global Economy Changed In One Month >
- We were then horribly disappointed by the mother of all economic data: the U.S. jobs report. U.S. companies added just 69k jobs in May. Economists were looking for an addition of 150k jobs. Last month’s number of 115k was revised down to 77k. The unemployment rate climbed to 8.2 per cent from 8.1 per cent a month ago.
- But not everyone thought it was a total disaster. Bank of Tokyo-Mitsubishi UFJ’s Chris Rupkey pointed to the 624k increase in the labour force. “At least we don’t have to hear about how people are dropping out of the labour force,” he wrote.
- It was a broad risk sell-off. Crude oil prices tanked to an 8-month low. But treasuries surged as investors sought safe-havens. US Interest Rates Have Made A Lot Of People Look Like Idiots Over The Past 10 Years >
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