The private HSBC China Purchasing Managers Index (PMI) was 47.8 for September. That is the eleventh straight month below 50. A reading below 50 is intended to reflect a contraction in manufacturing. China’s GDP was at 7% in the second quarter but looks like it will fall short of this level in the third quarter. The Shanghai stock index fell another 2.1%. The index is now down 17.3% over the past year.
A eurozone PMI from Markit Economics was 46.0, down from 47.2 in August. The reading for France was 42.6. European markets are down today.
A reading on US manufacturing in the Philadelphia Fed region is due at 10:00 ET. A -4.0 read, reflecting contraction, is expected. US industrial production fell 1.2% in August and early indicators suggest another decline for September.
New claims for unemployment for the week ended September 15 fell to 382,000 from 385,000 the prior week but the prior week’s number was thought to have been a weather-induced temporary pop. Claims have been trending slightly higher the past couple of months and the four-week moving average rose to 377,750 from 375,750.
Earnings warnings came from Adobe Systems (ADBE), Bed Bath & Beyond (BBBY), and Norfolk Southern (NSC). The third is of concern as transportation is still an important indicator of economic trends. The company said revenue will be lower than the year-ago quarter because of declines in coal and merchandise shipments. Earnings warnings pick up in the final weeks of any calendar quarter.
The earnings and economic trends are not good. The market is holding up much because of because of QE3.
In Hansen Medical (HNSN) there was a buyer of 1,000 March 2.5 calls. The company has rallied on the announcement that it received 30 additional U.S. patents for medical robotics.
In energy company Oneok Partners (OKS), there was a buyer of 1400 Oct 60 calls.