For the eleventh month in a row, the global manufacturing PMI has been in contraction, at 48.7 in July. But this is little changed from June's 48.8 to underscore the near 50 readings all through this streak.

Down for a 13th straight month were new orders, at 47.7 and a bit deeper in the red than June's 48.0. New export orders fell 7 tenths to a 46.1 reading that indicates tangible contraction.

Yet global manufacturers aren't cutting payrolls with employment edging 2 tenths higher to 50.2. Production was steady at 49.0 as were price indications, at 49.3 for inputs and 49.6 for outputs both confirming an end to the producer price spiral of last year.

The report notes signs of weakness emerging in Asia with Japan, China, South Korea, Taiwan, Vietnam and Malaysia all cutting back production. The report cites deterioration in international trade flows and draws in inventories as concerns.

J.P. Morgan Global Manufacturing PMI gives an overview of the global manufacturing sector. It is based on monthly surveys of over 10,000 purchasing executives from 32 of the world’s leading economies, including the U.S., Japan, Germany, France and China which together account for an estimated 89 percent of global manufacturing output. It reflects changes in global output, employment, new orders and prices. The Global Manufacturing PMI is seasonally adjusted at the national level to control for varying seasonal patterns in each country and is produced by J.P. Morgan and Markit Economics in association with ISM and the International Federation of Purchasing and supply Management (IFPSM).

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. The J.P. Morgan Global Manufacturing PMI provides advance insight into the global manufacturing sector, which gives investors a better understanding of business conditions and valuable information about the economic backdrop of global markets. The stock market likes to see healthy economic growth because that generally translates to higher corporate profits. The bond market prefers less rapid growth and is extremely sensitive to whether the economy is growing too quickly and causing potential inflationary pressures. The PMI data are also used by many Central Banks to help make interest rate decisions.

The J.P. Morgan Global Manufacturing PMI data give a detailed look at the manufacturing sector including the pace of manufacturing growth and the direction of growth for this sector. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. In addition, its sub-indexes provide a picture of output, employment, new orders and prices.