Global manufacturing PMI posted 50.8 in October, up 0.1 points from September's revised 50.7 and just short of August's 14-month high of 50.9. This is the second-best reading of the year, and it signals expansion in operating conditions. However, regional differences remain apparent.

The mixed report is reflected regionally, with India, Thailand, and Vietnam expanding in manufacturing output. The US, Europe and the UK also expanded. Growth slowed in China while Japan and Brazil showed contractions.

Demand remained weak, leaving employment broadly unchanged globally as higher employment in China, the US, Japan and India was offset by job losses in the UK, Europe and Brazil. Price pressures eased to a 5-month low in October, with higher costs being passed down to customers raising the selling price.

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.