European stocks are under pressure at the start of the week as a raft of PMI readings painted a gloomy picture for the currency block.
We've become accustomed to seeing weak manufacturing PMIs, not just in the euro area but across the globe as slower growth and the trade war takes their toll. The numbers this morning though were particularly poor and the services sector may now be getting caught up in it all which doesn't bode well.
The central bank is doing everything it can to support the economy but there's only so much more it can do and it could be argued that they're now at a point of diminishing returns. A reluctance to loosen the fiscal purse-strings, particularly in Germany, isn't giving investors any confidence that the situation is going to improve any time soon.
Mario Draghi is due to speak later on today and may offer a view on this. Given his comments after the meeting a couple of weeks ago in which he unusually called on governments to do more, these remarks may be interesting. The shackles are coming off which may result in more honest and less restricted views from the outgoing President.
Gold buoyed but vulnerable
Gold ended last week on a positive note and is trading in the green again this morning. That said, it's not yet broken above $1,530 which may be indicative of a rebuilding of bullish momentum, despite the yellow metal having barely corrected following the summer surge.
A failure to break above $1,530 will draw additional attention back to $1,480, a level that's a key area of vulnerability for gold. A break below here could trigger a deeper correction, with $1,450 being the next notable area of support.
Oil slips on weaker PMIs
Oil prices are tracking European markets lower this morning, understandably knocked by the woeful manufacturing data from the block and the implications for global growth and demand. The US will be next to release its PMIs later today but there isn't enormous cause for optimism here either. It may not be as bad a case as the eurozone, or close for that matter, but the trend is ugly.
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