China’s factory activity growth slowed and missed forecasts in April
Wall Street stocks finished higher overnight as investors digested fresh corporate earnings and upbeat economic data. The U.S. gross domestic product expanded at a 6.4% annualized rate in the first quarter, while jobless claims fell last week to a fresh pandemic low. As a result, the S&P 500 index rose 0.68%, the Dow Jones Industrial Average added 0.71%, while the Nasdaq gained 0.22%.
Asian stocks were lower on Friday as risk sentiment has deteriorated ahead of the weekend as China’s factory activity growth slowed and missed forecasts in April. The official manufacturing PMI fell to 51.1 from 51.9 in March while a sub-index for employment slipped to 49.6 from 50.1. As such, the Shanghai Composite shed 0.81%, Japan’s benchmark Nikkei 225 dipped 0.83%, Australia’s S&P/ASX 200 fell 0.80%, and Hong Kong’s Hang Seng lost nearly 2%.
In Europe, equities opened marginally higher amid strong corporate earnings. AstraZeneca gained 2.7% on reporting better-than-expected results and forecasting sales growth. Barclays reported a quarterly profit that more than doubled, but the bank’s stocks sank over 6%. BNP Paribas also posted a better-than-expected profit. On the data front, German GDP arrived at -1.7% QoQ in Q1 vs. -1.5% expected, while the annualized GDP rate fell by 3% against the previous reading of -3.7%.
Meanwhile, the dollar is mostly higher today as risk demand looks more subdued ahead of the weekend. EURUSD extended its downside correction from yesterday’s peaks at 1.2150 and was last seen just below the 1.2100 figure. Later in the day, fresh economic data out of the United States could affect dynamics in the pair. In the immediate term, the least path of resistance is to the downside. At the same time, the upside potential for the greenback remains limited.