The flash 44.2 sector PMI was revised up a couple of ticks to 44.4 in the final report for year-end. This constitutes a 7-month high but still means that business activity remained mired in recession and almost certainly subtracted from economic growth.

Manufacturing output (44.4 after 44.6) fell again and by more than mid-quarter. Production continued to be hit by weak demand with new orders falling for a seventh successive month on the back of weakness in both the domestic and overseas markets. Backlogs similarly extended their downtrend while employment also was cut once more. On a more positive note, supplier delivery times shortened further and, despite the softness of current conditions, business expectations for the year ahead improved to their highest level since April. That said, the latest reading was still historically weak. Input costs were down for a tenth straight month and factory gate prices were also lowered again.

In terms of national PMIs, the best performing country was Greece (51.3) which was the only member state to register above the 50-expansion threshold. Ireland (48.9) was not far behind, but the gap widens after that with Spain (46.2), Italy (45.3), the Netherlands (44.8), Germany (43.3), France (42.1) and Austria (42.0) all well short.

Today's report means that the Eurozone RPI and RPI-P opens 2024 standing at minus 4. In other words, overall economic activity is moving in broadly line with forecasts and so continues to support expectations for ECB easing over the course of the year.

No revision is expected to the flash data leaving the sector PMI at 44.2, unchanged from its final November mark.

The Manufacturing Purchasing Managers' Index (PMI) provides an estimate of manufacturing business activity for the preceding month by using information obtained from a representative sector survey incorporating around 3,000 companies. Results are synthesised into a single index which can range between zero and 100. A reading above (below) 50 signals rising (falling) activity versus the previous month and the closer to 100 (zero) the faster is activity growing (contracting). Released by S&P Global, national data are included for Germany, France, Italy, Spain, the Netherlands, Austria, the Republic of Ireland and Greece. These countries together account for an estimated 89 percent of Eurozone manufacturing activity.

Investors need to keep their fingers on the pulse of the economy because it dictates how various types of investments will perform. By tracking economic data such as the ISM manufacturing index in the U.S. and the S&P Global PMIs elsewhere, investors will know what the economic backdrop is for the various markets. The stock market likes to see healthy economic growth because that 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 S&P Global PMI manufacturing data give a detailed look at the manufacturing sector, how busy it is and where things are headed. Since the manufacturing sector is a major source of cyclical variability in the economy, this report has a big influence on the markets. And its sub-indexes provide a picture of orders, output, employment and prices.