Purchasing Managers Indexes (PMIs) are now signaling expansion in two of the world’s largest economies as China’s reading joins the US measure in positive territory. China’s rebound from negative territory may be an early indicator that expansionary monetary and fiscal policies are beginning to take effect. That’s welcome news. However, the Eurozone PMI is continuing to deteriorate with disappointing results in the German and French manufacturing sectors. The lack of pro-growth fiscal policy in the EU is still a major drag on economic vibrancy. That said, European bourses have posted robust returns so far this year although not as strong as US counterparts.
