Analysts at TD Securities express their afterthoughts on the upbeat US ISM Manufacturing PMI report released on Monday.
“The ISM manufacturing index surged above participants’ expectations, rising to its highest level since July at 50.9 for January (TD 50.0; consensus 48.5), following 47.8.
The gain was led by a whopping 9.5pt jump in the production component to 54.3 as well as a notable 4.4pt increase in new orders to 52.0.
The December trade agreement between the US and China likely played a key role behind improving sentiment.
We note, however, that coronavirus fears might affect the survey as soon as in February, as a possible growth slowdown in China is likely to impact manufacturing activities.”