Qingzhou city in East China’s Shandong province faced an unexpected setback as its manufacturing sector contracted in May, according to official data. The Purchasing Managers Index (PMI) dropped to 49.5 from 50.4 in April, falling below expectations. This decline signifies a shift, with the 50-point threshold separating expansion from contraction. The downturn comes on the heels of a 4.3% year-on-year increase in industrial profits from January to April, as reported earlier in the week.
In a contrasting scenario, Tokyo, Japan witnessed core inflation rising to 1.9% in May, surpassing the 1.6% growth seen in April. These figures align with projections, with Tokyo’s inflation often serving as a precursor to national trends. Meanwhile, Japan’s industrial output experienced an unexpected decline of 0.1% in April, bucking the anticipated 0.9% increase.
Moving south to South Korea, industrial production saw a positive turn in April after a previous month’s decline. The industrial production index increased by 2.2% on a seasonal basis, surpassing expectations of a 1.1% rise. However, retail sales in South Korea took a hit, dropping 1.2% from March and 2.6% from the same period last year.
Across the globe, significant developments in the financial sector have captured investor attention. Barclays identified European stocks with high upside potential, citing strong earnings and EPS trends. Similarly, Goldman Sachs highlighted the growing demand for power amidst the AI boom, introducing a portfolio of stocks across several Asian countries to capitalize on this trend.
As markets fluctuate, LPL Financial notes a positive trend in the S&P 500, pointing to a promising May performance. Analysts suggest a market analogy of “April showers bring May flowers,” indicating a rebound after April’s setbacks. However, caution is advised for the upcoming summer months, with historical data indicating potentially lackluster market performance in June.