UK Private Sector Activity Growth at 7-Month High
The IHS Markit/CIPS UK Composite PMI registered 56.6 in March of 2021, up sharply from 49.6 in February and above the crucial 50.0 no-change mark for the first time in three months. The latest reading signalled a strong rate of private sector output growth and the speed of recovery was the fastest since August 2020. For the first time since the start of the pandemic, service sector activity (index at 56.8) outpaced manufacturing production growth (55.6). This was fuelled by a rise in new orders for the first time since September 2020, which survey respondents attributed to a rebound in sales ahead of easing lockdown measures, alongside stronger consumer confidence and a surge in demand for residential property services.
Italian Shares Trade Around the Flatline
The FTSE MIB swung between gains and losses on Wednesday, in a bearish day for European markets, as investors continue to worry over a new coronavirus wave in the continent that could delay plans to ease restrictions. In Italy, Draghi told Senators he plans to reopen schools and kindergartens after Easter, including in red zones, which have a weekly incidence higher than 250 cases per 100 thousand inhabitants. On the data front, both services and manufacturing activity in the Euro Area beat forecasts in March, with Manufacturing PMI hitting a record high of 62.4, while the contraction in services eased. On the corporate front, Leonardo shares plummeted after the IPO of its American subsidiary DRS was postponed amid adverse market conditions.
UK Services Activity Growth at 7-Month High
The IHS Markit/CIPS UK Services PMI posted 56.8 in March of 2021, up from 49.5 in February and above market expectations of 51, a preliminary estimate showed. The latest reading pointed to the first expansion in the services sector since October 2020. Moreover, the rate of business activity expansion was the strongest seen since August 2020. March data also signalled a return to growth for new orders and employment across the service economy. Service providers widely commented on improving consumer confidence and signs of pent-up demand. Expectations of rising sales after the national lockdown, and a boost to sentiment from the successful UK vaccine rollout, contributed to an increase in business optimism to its highest since January 2004.