Out Fox The $treet

The euro-wide composite index of purchasing managers in both services and manufacturing industries improved in January. What? Thought Europe was in a deep recession. Now we're already hearing talk of the downturn bottoming out. The composite index rose to 50.4, a five month high, from 48.3 in December according to Markit Economics. Naturally this wasn't an overly robust report and the gain was partially from a reduction in order backlog.  Both sectors saw improvement though the services index was the only one above 50 or signalling growth at 50.5. Manufacturing was still declining but at a slower rate. More importantly is that German manufacturing responded to a lower Euro with growth for the first time in four months. Sure this doesn't mean that Europe is out of the woods already, but the debt crisis clearly isn't having as negative of an impact on 2012 business as most predicted when the year started. Per Businessweek article: A euro-area composite index...

My understanding is that Germans are not as heavily invested into the stock market as the US, but a 15% drop in you countries main market index surely catches the attention of politicians. From the chart below, the majority of the loss took place in the just the first part of August when the index plunged from around 7,200 to 5,600. Some might doubt the willingness of Germany to bailout the Southern Europeans, but such moves suggest they have more incentives than most people would think.

The Monster Employment Index Europe demonstrated year-over-year growth of 18 percent. Thought Europe was headed to a massive recession? Ok, the index is actually flat to down since peaking at 140 in June. Clearly the trend is not optimal, but it's not as dire as most in the media would suggest. The top growth areas were Engineering, Manufacturing, Transport, Telecommunication, and Real Estate. Clearly Europe lacks the mining and oil exploration growth that the US is seeing. This has and will be a major hamper to their economy as growing commodity prices can't be escaped via production increases. The regional data is much more telling. Germany continues to soar up 37% YOY while all other regions have seen major declines since June. Even Belgium, France, Netherlands, and Sweden have seen declines. Not surprising to see Italy drop, but it does highlight why Germany wants the European Union to survive. The weakness in the other European countries is holding down the euro and m...

So much for the government debt issue in Europe keeping the Germans down. Earlier this morning, Germany reported a huge jump in investor sentiment. The index jumped over 15 and was much better then the expected 6.8 points. Though expectations for exports are slightly weaker in 2011, the private sector is expected to grow nicely. In reality, a jump in investor sentiment shouldn't be that surprising with the DAX jumping all the way back to 2008 highs. The market is booming yet analysts estimates still appear constrained and out of tune with the facts. Whats amazing is that the US markets such as the SP500 remain nearly 300 points below its all time high back in October 2007. Will the US eventually catch up? Via CNBC : The Mannheim-based ZEW think tank said on Tuesday its monthly index jumped to 15.4 points from 4.3 in December. KEY DATA GERMANY JAN DEC economic sentiment 15.4 4.3 current conditions 82.8 82.6 Economists had expected the economic sentiment reading to rise to 6...

According to the export numbers in May, the biggest economy in Europe might have already pulled out of recession. Of course, you don't see this new prominent in the media today. All I'm seeing is reports about how the initial jobless claims weren't as good as they were. More about that later. Germany is the largest economy in Europe so this is significant news, but they hardly match up with the US, Japan, or even China. Its a start though and much better then the relentless media coverage about how the recovery isn't taking place. The facts continue to suggest otherwise. Germany, Europe's largest economy, suffered a 3.8 percent contraction in the first quarter and is facing its deepest post-war recession this year, but a 0.3 percent rise in exports in May chimed with other data pointing to a recovery. May industry figures showed output growing at its fastest rate in 16 years, while orders surged to a near two-year high.