US stock market

Early on March 22, US stock indexes were trading on a negative note. On March 21, the stock indexes ended on a bullish note. On March 21, the S&P 500 Index, the NASDAQ Composite Index, and the Dow Jones Industrial Average rose 1.1%, 1.4%, and 0.8%, respectively. The losses on March 22 were mainly driven by weak manufacturing and services PMI data from Europe. The data were released by IHS Markit on March 22.

Weak European Data Are Bothering US Investors

Weak European data

According to the latest data, the Flash Germany PMI Composite Output Index fell to its 69-month low at 51.5. The Flash Germany Services PMI Activity Index fell to its two-month low at 54.9 in March.

Also, the Flash Germany Manufacturing Output Index fell to its 79-month low at 45.0 in March from 47.9 in February.

In the report, IHS Markit highlighted that a sharp drop in the Germany output index signaled “the slowest rate of business activity growth since mid-2013.” IHS Markit’s principal economist, Phil Smith, considers “uncertainty towards Brexit and US-China trade relations, a slowdown in the car industry and generally softer global demand” to be the key factors hurting the manufacturing sector’s performance in Germany.

US investors are concerned

US investors (SPY) (QQQ) are concerned that the US can’t keep itself away from the slowing global economy. Investors are also concerned about the negative impact of US-China trade relations.

The US trade war with China and European countries, triggered by President Trump, has impacted many US companies including automakers like General Motors (GM) and Ford (F).

Other US companies including NVIDIA (NVDA), Procter & Gamble (PG), Walmart (WMT), Facebook (FB), Amazon.com (AMZN), and Alphabet (GOOG) have already warned about how the tariffs will impact their businesses. Some recent media reports also suggest that large US firms including General Electric (GE) and Boeing (BA) will likely suffer due to the US trade war with other countries.

Next, we’ll discuss some companies that might be impacted the most by a slowdown in the European economy.

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