Good morning! Here’s what you need to know.
Eurozone manufacturing PMIs are coming. September’s manufacturing PMIs for the eurozone, a set of closely-watched business surveys, are coming out from 8:15 a.m. to 9 a.m. UK time (3:15 a.m. to 10 a.m. ET). Analysts expect a score of 52.5, above the neutral 50 level, signalling growth.
The US launched an insider trading probe into Fed leaks. US prosecutors in New York have launched an insider-trading probe into a leak of sensitive information from the Federal Reserve in 2012, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.
China’s small and medium-sized manufacturers had the worst month since 2009. Activity across small and medium-sized Chinese manufacturing firms deteriorated at the fastest pace since March 2009 according to the latest Caixin manufacturing PMI report released by Markit. In September, the index fell to 47.2 from 47.3 in August, with anything below 50 signalling shrinkage.
The country’s overall manufacturing PMI was a little better. China’s manufacturing PMI report beat expectations in September, rising to 49.8 from 49.7 in August. Despite the small improvement, activity levels have now contracted for two consecutive months, something that has not occurred since January and February this year.
Asian markets are up. Hong Kong’s Hang Seng is up 1.41%, followed by the Shanghai Composite, which is 0.48% higher. Japan’s Nikkei leads, up by 2.33%.
And Chinese firms are getting more bearish. Based on the latest quarterly survey of banks, companies and households conducted by the People’s Bank of China — a report that captures the views of 20,000 urban households, 5,000 businesses and 3,100 banks — sentiment towards the economy deteriorated sharply despite relative stability in business profits, orders and labour market conditions.
Pacific trade deal negotiators reportedly surmounted a major hurdle. Negotiators trying to clinch a Pacific Rim free trade deal made progress toward resolving a key issue on Wednesday when Canada and Mexico signalled a willingness to open the North American auto market to more parts made in Asia, people briefed on the closed-door talks said.
Data also indicates that US manufacturing is in recession. On Wednesday, we got the latest data on manufacturing activity in the Midwest from the Chicago purchasing manager’s index reading, which unexpectedly showed that activity contracted in September. The Institute for Supply Management’s Milwaukee report on business also indicated a contraction in activity.
LG Electronics expects sales to improve in the fourth quarter. Speaking at a launch event for the new V10 smartphone, LG mobile division chief Cho Juno told reporters the firm will use the high-end device as well as new mid-to-low tier products to boost market share.
A Chinese bank announced massive fintech investment in the US. SoftBank Group said it had led a $US1 billion (£660.7 million) investment in US financial technology startup SoFi, calling it the largest single financing round in the fintech space to date.