The new month began with some rather upbeat news from Europe. Germany, the EU’s most robust economy, revised its GDP forecast upward, indicating that the government expects a somewhat faster recovery than earlier estimated. Germany’s unemployment rate was in line with the forecasts at 6.4%, while the employment change was better than expected. Still, the manufacturing PMI, although higher than the previous report, did not increase quite as much as investors had hoped for.
The manufacturing PMI of the eurozone met the forecasts exactly at 51.7. Nevertheless, core inflation disappointed by dropping all the way to 0.4% versus a forecast of 0.8%. The unemployment rate for July was slightly lower than expected, though, showing a recovery on that front at least.
Even if some of the reports are mixed, their overall impact was enough to give the euro a boost. The single currency is now close to testing the 1.20 level versus the dollar, its highest in more than two years.
Furthermore, the company Zoom is making great waves through the stock markets after posting record earnings. The video conference software Zoom has become the go-to choice for schools and businesses all over the world during the pandemic, which explains its huge gains. In total, the company’s earnings have grown by 355% in 2020.
Thanks in large part to Zoom’s success, the tech-heavy Nasdaq index has gained 1% today, much more than the S&P 500’s 0.2% increase.
Aside from the European PMIs, investors expect the same reports from the United States today as well. This data is important in determining the pace of the economic recovery in the US, especially considering the severity of the coronavirus outbreak in the country.
As for the pandemic itself, today the number of cases worldwide has surpassed 25.6 million. The United States has 6.2 million Covid-19 cases, of which 38,000 were confirmed yesterday. Brazil’s tally is sitting at just under 4 million, while India has close to 3.7 million cases now. Russia officially surpassed 1 million coronavirus cases.
