The market sentiment is mixed, but there are still interesting movements on the market.
China's industrial profits speed down for sixth month
In October, profit surge at China's industrial companies speeded down for a sixth month in a row due to the fact that factory prices along with the tempo of sales increases decreased against the backdrop of strengthening uncertainties stemming from the US-China trade conflict.
The figures actually hint at further deceleration in the Asian country’s manufacturing sector and the economy in general days ahead of a high stakes gathering between US leader Donald Trump and Xi Jinping, which the Chinese cabinet hopes could prevent a further escalation in their conflict.
America and China have already imposed levies on billions of dollars of each other's products, impacting manufacturing and worsening the general outlook for global surge.
As a matter of fact, in October, industrial profits headed north by up to 3.6% from 2017 hitting 548 billion Yuan, which is a 7-month minimum, speeding down from September's 4.1% surge. That’s what the National Bureau of Statistics uncovered on Tuesday.
The deceleration occurred mostly because of cooling factory-gate inflation as well as a high-base effect.
Some financial analysts are assured that profitability will keep deteriorating in the nearer future.
Nomura economists told that the descending trend will persist considering already-high financing costs, sluggish domestic demand, soaring credit defaults, not to mention the escalation in the China-US trade clash.
Moreover, factory-gate inflation has been receding for the last time on sluggish demand, notwithstanding government efforts to stimulate the national economy, with credit-easing measures to spur lending to businesses and increase infrastructure spending.
October's revenue data showed up as fears about the US-China conflict were boosted by US leader’s interview to the Wall Street Journal before his gathering with Chinese President in Argentina at the end of this week.
China is currently experiencing slower economic surge due to the trade conflict and efforts to tame financial risks and resolve pollution issues.
After Trump-Biden debates the market reaction was initially positive, but Trump's refusal to accept election results in case of Biden’s victory deteriorated the overall sentiment.
China’s Manufacturing PMI will be out on Wednesday at 04:00 MT time!
Canada’s retail sales will be out on October 21 at 15:30 MT time. Get ready with us for this event!
The market is resilient ahead of the speeches of Fed’s Powell and ECB President Lagarde, but there are still interesting movements.
The uncertainty over US fiscal stimulus and Brexit, and also rising new virus cases deteriorated the market mood. That’s why we can expect the further rally of the US dollar and the fall of riskier assets today.