* China, Japan PMIs show manufacturing growing again
* U.S. factory activity expands most in four years
* Euro zone growth slows, German-French divide remains
By Aileen Wang and Jason Lange
BEIJING/WASHINGTON, June 23 Global manufacturing
activity appeared to accelerate in June, buoyed by a return to
growth in China and Japan and the fastest expansion in the U.S.
factory sector in more than four years.
Surveys of manufacturers around the world released on Monday
gave some positive signals for the global economic outlook, but
dark clouds remained over Europe, where an unexpectedly sharp
fall in French business activity dragged on the wider euro zone.
The data suggested Beijing's targeted stimulus measures and
Japan's improving labor market were helping domestic demand in
Asia's dominant economies.
The HSBC/Markit Flash China Manufacturing Purchasing
Managers' Index rose more than expected to 50.8 in June from
49.4 a month earlier. The 50-point level separates growth in
activity from contraction.
"The authorities' mini-stimulus is filtering through to the
real economy," said Qu Hongbin, chief economist for China at
China's government has unveiled a series of modest measures
to support economic growth in recent months, including reserve
requirement cuts for some banks that could encourage lending.
The Markit/JMMA flash Japan Manufacturing PMI also rose in
June, hitting 51.1 and showing the first growth in three months.
External demand remained weak for the two export
powerhouses, and some analysts think China may need more
stimulus to offset a cooling housing market and avoid a sharp
slowdown in economic growth.
Japan's weak exports also take the gloss off the
government's efforts to breathe new life into its economic
But in a more positive sign for global demand, U.S.
factories showed their strongest growth in activity since May
2010, with Markit's preliminary PMI rising to 57.5.
That bolsters expectations U.S. factories will grow busier
in the second half of this year, said Barclays economist Cooper
While the data was generally positive for the factories of
the world's biggest economies, there were more worrisome signs
Germany and France went their separate ways again, with
German business activity expanding robustly, albeit at a slower
pace than last month, while France's private sector shrank at
the fastest rate in four months.
"The recovery has not gained as much traction as people had
hoped," said Jessica Hinds at Capital Economics. "It's
definitely a concern."
Markit's composite PMI, based on surveys of thousands of
companies across the 18 countries that use the euro, fell to
52.8 from May's 53.5. That was well below the consensus in a
Reuters survey and matched the lowest forecast polled.
Markit said that with a robust recovery taking place in some
euro zone periphery countries, the data still point to
second-quarter economic growth of 0.4 percent.
Germany, Europe's largest economy, was again the driving
force although its composite PMI eased to 54.2, while the French
index slumped to 48.0, its lowest reading since February.
Also somewhat worryingly for the European Central Bank, a
composite PMI sub-index measuring output prices held below the
50 mark for the 27th month, coming in at 49.7 as firms kept
cutting prices despite soaring input costs.
Inflation in the euro area slowed to just 0.5 percent in
May, prompting the ECB to cut interest rates to record lows and
offer new long-term loans to banks to help boost lending to euro
"The further weakening of the PMI vindicates the ECB's
recent decision to implement further monetary easing and will
keep fears of a Japanification of Europe firmly alive," said
Martin van Vliet at ING.
European stocks fell after the euro zone data in contrast
with the upbeat numbers from China that earlier lifted Asian
shares and the Australian dollar.
(Reporting by Aileen Wang in Beijing and Jason Lange in
Washington; additional reporting by Stanley White in Tokyo and
Jonathan Cable in London; Editing by Chizu Nomiyama)