Our Market Optics chartbook contains data-driven insights that power our portfolio management teams’ views, ideas, and decisions. Each week, we’ll take a look a closer look at one of the charts.

This week’s topic: Global Economy: Business Activity.

  • Globally, manufacturing and services were both hit hard by the coronavirus shutdowns, but progress there is typically seen as progress toward recovery.
  • During the shutdowns, purchasing managers’ indices hit record lows, but starting in May, healing began.
  • There were renewed worries of renewed slowdown with the rise in coronavirus cases in June and as some areas started rewinding reopening plans, but June activity defied dire expectations.
  • Wave after wave of worry has helped keep expectations for the recovery muted, but reality has been better than muted expectations. Don’t underestimate the power of low expectations to keep pushing the equity markets higher.


The PMI (Purchasing Managers’ Index) is a diffusion index where respondents are asked if things are improving or getting worse in the manufacturing and service sectors. Those who say things have stayed the same are split evenly between the improving and getting worse categories. A reading of 50 means 50% of the respondents say things are the same or getting better and 50% say things are the same or getting worse.



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