Thursday, March 8, 2012

Global Super PMI

While the stock market was in the process of having its worst day so far this year, JPMorgan and Markit released their Global Manufacturing & Services PMI yesterday at 11 am (E.S.T.). Guess what it did? It rose for the fourth month running in February. In fact, it rose from January’s 54.5 to last month’s 55.5, which was the highest level in a year! The Devil is in the details: “Growth picked up in both the manufacturing and service sectors, although service providers maintained the stronger rate of expansion overall. Growth was heavily skewed towards the US. The US expanded at the fastest pace since February 2011, led by a strong increase in non-manufacturing output. In contrast, the global average excluding the US readings was almost four points lower (at 51.7) than the actual headline reading (55.5).”

I construct a similar Global Super PMI by taking an unweighted average of the manufacturing and non-manufacturing PMIs for the US, the Euro Area, the UK, and China. The JPMorgan index is a weighted average. My Super index fell last year from a high of 56.4 at the start of the year to a low of 50.0 during November. It rebounded to 52.6 during January and was little changed at 52.2 during February. It hasn’t been below 50 since June 2009. (More for subscribers.)

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