China Services PMI in June
According to data from Markit Economics, the final China Markit Services PMI improved significantly in June. It was 53.9 in June compared to 52.9 in May. It beat the preliminary market estimate of 52.7 and was the highest improvement in the services sector in the past four months.
The China Services PMI in June is due to the following factors:
- Production output and volume rose at a stronger pace in June than in May.
- New business orders rose at a faster pace in June.
- Employment in the services sector improved at a higher rate in June.
ETF performances in June
Chinese businesses in the services sector were optimistic about the country’s short-term economic outlook. Despite trade tensions, businesses expect the domestic economy and client demand to show huge improvements in the near future. Gradual improvement in new orders signals the same.
The iShares China Large-Cap ETF (FXI) fell 8% in June. The Direxion Daily FTSE China Bull 3X ETF (YINN), which tracks the performance of China (ASHR), fell 20.9% that month. Major ETFs fell in June as trade tensions between the United States (SPY) and China intensified.
In the next part of this series, we’ll analyze the performance of the Indonesia Manufacturing PMI in June.