European Manufacturing Improves, Markets Rebound To The Upside

With the start of the session today the sentiment was negative, while markets were pessimistic as the flow of downbeat fundamentals from Asia spread negativity in the market; however, the Chinese manufacturing sector started the optimism in the market today. Furthermore, the European manufacturing sectors improved beyond expectations in January, raising optimism in the market that the euro-area region is on the right track to avoid slipping back into another phase of recession despite the two-year debt crisis.

Positivity spread in the market after the upbeat performance of the Chinese manufacturing sector, where all eyes track the strength of the Chinese economy which leads the recovery along with the United States. The PMI manufacturing for January showed that the performance of the Chinese manufacturing sector expanded unexpectedly to 50.5 from 50.3, beating median estimate of 49.6.

However, until the start of the European session markets were pressured to the downside, while the euro recorded sharp decline against the low yielding U.S. dollar, but after the flow of upbeat manufacturing data from Europe, the common currency returned to gain momentum and advanced against the greenback.

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