Latest Technology and Financial News

Search Stocks

China Continues to Slow

Dec 01,2014  Market News  Comment: 0

Report A Spam
Facebook Twitter Google LinkedIn StumbleUpon Pinterest Email
Report A Spam

Article(40)
Comments(0)

Kokomo, IN – (StockNewsDesk) – 12/01/2014 — The future index of major indices in the United States retreated from all-time highs after China’s economy faced slowdowns in the manufacturing sector and factory activity. Following the disclosure of the economic indicator, gold prices fell to a two-week low while crude oil prices also corrected over 2%. With the Chinese manufacturing and factory activity contracting, there is a high chance that stimulus measures will be taken to boost the Gross Domestic Product (GDP) growth to 7.5%

Chinese Manufacturing and Factory Output Slows

The manufacturing Purchasing Managers’ Index (PMI) continued to contract. The manufacturing PMI came in at 50.3 compared to the Street’s expectation of 50.6 and earlier period’s reading of 50.8. Lower than expected demand and increasing costs are predominantly responsible for the fall in the manufacturing sector. The PMI index is gradually approaching the 50.0 level, which separates expansion from contraction. Another preliminary reading hints at the slowdown in factory activities as well. Growth in factory activities declined for the first time in six months. The reading came in at 50.0. However, factory output went below the 50.0 level to 49.6; the lowest level since May this year.

Housing Prices Weigh on China’s GDP

Housing prices continue to cool and add to the slowing economy. On average, home prices fell 0.4% in November compared to October prices. This was the seventh consecutive month of declination. Chinese policy makers gained investors trust when they decided to cut one-year interest rates to 2.75%. However, they expect more stimulus measures in light of the slowing housing sector and ailing manufacturing and factory activity. Last month, China reported a GDP of 7.4%, lowest in more than two decades. Prevailing weakness in economic numbers point towards further weakness in GDP numbers. Economists predict a GDP growth of 7.1%, which is likely to touch the lowest level in nearly three decades.

The labour market was also not spared from the slowing economy of China. The employment index of China declined for the thirteenth consecutive month. Chinese policymakers fear that at the prevailing pace, the country is vulnerable to face a GDP of 7% and a deflationary situation. Major problems in the Chinese economy include business failures, bad loans and job losses. They may further reduce the interest rates if they think it can help stabilize economic growth and ease the slowdown.

China Continues to Slow

Economic Indicators of the U.S., Euro zone to Impact

In light of lower than expected manufacturing PMI, the gold futures and crude oil futures fell more than 2% each. Gold futures fell to a two-week low of $1,150 while crude oil futures fell to $63 a barrel. The U.S. is set to reveal employment and jobs data on Thursday and Friday. This could decide the trajectory of these commodities in the days to come. Moreover, the euro zone is also set to report their manufacturing and factory activities today, which can also impact the gold and crude prices.

Related posts

Share your views and Comment below

Connect with:

Search Stocks

Search Articles

LG’s Android G Watch burs…

posted on July 9, 2014 , by Prabir Sinha

Amazon Intensifies Battle…

posted on July 10, 2014 , by James Smith

Deutsche Bank Weakness Ac…

posted on July 11, 2014 , by James Smith

Citigroup Can Deduct $3 B…

posted on July 16, 2014 , by David Goehst

Apple, IBM form Strategic…

posted on July 17, 2014 , by David Goehst

Recent Comments
  • User AvatarCharlesetta Chipman { Would love to perpetually get updated outstanding weblog ! . } – Feb 25, 3:25 PM
  • User AvatarChanda Hinnant { magnificent issues altogether, you simply won a new reader. What could you recommend about your post that you just made a few days ago? Any... } – Feb 25, 1:17 PM
  • User AvatarLenny Strawther { Outstanding post, you have pointed out some superb points, I likewise conceive this is a very good website. } – Feb 25, 12:31 PM
  • User AvatarJennette Lysaght { I have been absent for a while, but now I remember why I used to love this website. Thanks, I will try and check back... } – Feb 25, 11:41 AM
  • User AvatarWilhemina Strube { I just couldn't go away your web site before suggesting that I really enjoyed the standard info a person provide to your guests? Is going... } – Feb 25, 10:30 AM
  • User AvatarGoogle { GREAT POST.THIS IS A GREAT NEWS. } – Feb 24, 7:22 PM
  • China Continues to Slow

    Login

    Connect with:

    Register | Lost your password?