The metal markets held up well at the start of the week, when others were worrying about political problems in Spain and Italy. In the former, prime minister Mariano Rajoy is facing scepticism as he denies receiving undeclared income. In the latter, revelations of attempts to hide an elevated price for a banking acquisition threaten to boost the election prospects of Silvio Berlusconi, whom the markets do not like.
0.1% - Annual decrease in GDP in the US between quarters 3 and 4 last year
General economic data was mixed. The purchasing managers’ indices (PMI) for China were largely positive. The official figure for manufacturing, which tends to reflect the activity of larger companies, dipped to 50.4 in January from 50.6 in December. This was mildly disconcerting to market watchers, although the lower figure was still above 50, pointing to some growth. The manufacturing figure compiled for the bank HSBC, which tends to reflect the activity of smaller companies, rose to 52.3 - its highest level for two years - from 51.3.
US gross domestic product data produced an unpleasant surprise when it decreased at an annual rate of 0.1% between the third and fourth quarters of last year, according to the Bureau of Economic Analysis. This was all the more unpleasant as the figure was up by 3.1% between the second and third quarters. The market tried to ignore this.
Other US data was better. The number of non-farm jobs increased by 157,000 in January, according to the Bureau of Labor Statistics, which was considered reasonable, and unemployment remained at 7.9%, more or less where it has been since September 2012.
The PMI for manufacturing, compiled by the trade association Institute for Supply Management, rose to 53.1 in January, up from an adjusted 50.2 for December, showing manufacturing activity expanding for the second consecutive month, with the rate accelerating. On top of that, the Census Bureau noted that the revised figure for new orders for manufactured goods increased by 1.8% in December. This followed a decrease of 0.3% in November, but was the third increase in four months.
Things were also less grim in the eurozone. The revised PMI for the zone in January, compiled by Markit Economics, rose to 47.9, its best showing for 11 months, which suggested the recession was easing. Output was improving in Germany, the Netherlands and Ireland, but was down in France.