Market roundup | Eurozone PMI falls, poor showing by services sector
- India may burn, but Modi only interested in becoming PM again: Rahul Gandhi
- Myth buster: Is India in the middle of a big cash crisis?
- India received $69 billion remittances in 2017, retains top slot
- Ten times foreign filmmakers made films set in India
- Oil dips as US drilling tempers otherwise bullish sentiment
The eurozone economy is slipping. The region’s Flash PMI (Purchasing Managers’ Index) for September slipped to 52.6, down from 52.9 in August, hitting a 20-month low, according to IHS Markit.
The manufacturing sector actually gained slight momentum, with factory output rising at the fastest pace since December, with Germany seeing a strong increase and France holding steady.
Services showed the smallest monthly increase since December 2014, with France doing well but that was not enough as Germany and the rest of the eurozone did not deliver. Slowing services sector indicates a weaker home economy, as this sector is more domestic-focused than manufacturing, said IHS Markit.
Price cut may hit India’s natural gas producers
India’s natural gas producers may be looking at a sharp cut in gas prices in the second half of the fiscal year, by as much as 18%, according to a survey done by Bloomberg News. That will translate into a price of $2.5 per million British thermal units (mmBtu) for October 2016-March 2017.
Domestic gas price stood at $3.06 per mmBtu in the first half. Lower prices will hurt profits of producers such as Oil and Natural Gas Corp. Ltd and Oil India Ltd. Additionally, “lower prices threaten to hamper the investment needed to turn around flagging output of the fuel in Asia’s No. 3 economy,” said the Bloomberg report. Prices in India are decided half-yearly, using a formula capturing global trends. The announcement is expected this week.
India’s MF:GDP ratio lowest among peers
India has the lowest mutual fund (MF) investment to GDP (gross domestic product) ratio at 7% (as of 2015) in the world when compared to both emerging market (EM) economies as well as developed economies, points out a joint report by consulting firm EY and Cafemutual.
EM countries such as China with 11% and Mexico with 9% are not far ahead, but Brazil sets an example with a 38% penetration. Low MF penetration in India is largely due to a lack of financial awareness among its investing population, according to the report.