| Actual | Previous | |
| Composite Index | 48.3 | 49.9 |
| Manufacturing Index | 50.2 | 49.9 |
| Services Index | 48.3 | 49.6 |
Highlights
The Composite PMI fell to 48.3 in March from 49.9 in February as the services sector weighed on the overall result.
While the manufacturing index reached a two-month high of 50.2, and remaining in expansionary territory, the services reading fell to 48.3 in March from 49.6, a 5-month low.
The conflict in the Middle East is playing a role, with respondents saying that clients had refrained from placing new orders given the conflict. Recent sentiment surveys indicated that while French businesses were pessimistic about there present situation, they were optimistic about the coming twelve months. That is now in jeopardy.
Another upshot of the war is increased delivery times, indicating a supply chain under stress.
Definition
The flash Composite Purchasing Managers' Index (PMI) provides an early estimate of current private sector business activity by combining information obtained from surveys of around 1,000 manufacturing and service sector companies. The flash data are released around ten days ahead of the final report and are typically based upon around 85 percent of the full survey sample. Results covering a range of variables including manufacturing output, employment, new orders, backlogs and prices 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). The report also contains flash estimates of the manufacturing and services PMIs. The data are produced by S&P Global.
Description
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 purchasing managers' manufacturing indexes, 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.