By David Schutz, THE TAKEAWAY:Eurozone PMIs well below 50 boom-bustline -> Europe scramble s to stimulategrowth as recent Fedcomments suggest crisis not over -> Euro suffers onweak data Manufacturing and services purchasing manager’s index numbers out of Europe came in a good deal weaker than expected today. The all-inclusive Euro-area PMI composite indicator came in at 48.7 versus the 49.6 predicted by economists. Eurozone PMI manufacturing was 47.7 versus the expected 49.5, and the services sector index came in 48.7 at versus the expected 49.2. A reading below 50 indicates market contraction. European powerhouses Germany and France both saw significantly weaker than expected numbers, with the German manufacturing index falling to 48.1 from February’s 50.2. French numbers were similarly risk-negative. Elsewhere, the Chinese HSBC PMI released overnight also came in below expectations, further weakening risk appetite into the European session open. Today’s numbers may suggest to some thatEurope’s financial crisis is far from over is far from over,and will likely throw a damper on recent optimistic comments fromEuropean officials. The ECB’s Assmusen yesterday mentionedthat it is time for the European Central Bank to gradually exitcrisis mode, but investors will likely be keen for the central bank to continue itslong term refinancing operations which are meant to encourageeconomic growth by making cash available to banks. Meanwhile, a ll eyes remain on America’s FederalReserve, with Chairman Bernanke yesterday weighing in on theEuropean situation saying that “further strengthening of the Europeanbanking system” would be required as the region faces therisks of a prolonged recession. The Euro plummeted nearly 80 points within the hour as today’s weak PMI numbers diminished confidence in the single currency.
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