Sharp fall in manufacturing activity
The market has soured on the outlook for the US economy. Regional manufacturing indexes have been mixed with some shocking falls along with an unusually strong Chicago PMI.
However the national reading from the ISM is the big one and the verdict there is a sharp slowdown, although it still remains comfortably in expansionary territory at 54.1.
The drop raises fresh concerns about the impacts of tariffs along with inventory building and overall economic activity. Earlier today the ADP report was strong but the ISM data is a more forward-looking data point and it was lower than any estimates.
Along with stock markets falling, the US dollar is being singled out (risk trades in FX are holding up so far). The euro has taken advantage is a climb to 1.1404 from 1.1365 before the data. The S&P 500 is down 53 points to 2457.
There is a strong message here that the trade war is raising uncertainty and hurting companies but will leaders in the US and China listen?
