Spain’s service PMI in May
According to Markit Economics, Spain’s service PMI rose marginally month-over-month in May, to 56.4 from 55.6. It beat the market estimate of 56.1 but marked its weakest expansion since December 2017.
Key factors driving Spain’s service PMI in May were as follows:
- Production volume and output improved at a marginally higher rate month-over-month.
- New business and export orders improved strongly.
- Service-sector employment grew, marking its largest improvement in 11 years.
The iShares MSCI Spain Capped ETF (EWP), which tracks Spain’s equity market, fell 8.2% in May, while the iShares Europe ETF (IEV) (VGK) fell 2.6%. The ETFs fell mainly due to rising political uncertainty in Spain, with prime minister Mariano Rajoy facing a no-confidence vote. This uncertainty affected investment sentiment, consumer demand, and manufacturing activity. However, service activity improved due to rising client demand. In the next part of this series, we’ll analyze the Eurozone’s service PMI in May.