Investing.com - Manufacturing activity in France contracted for the first time in three months in May, renewing concerns over the economic outlook of the euro zone’s second-largest economy, preliminary data showed on Thursday.
In a report, market research group Markit said that its preliminary French manufacturing purchasing managers’ index fell to a seasonally adjusted 49.3 in May from a reading of 51.2 in April. Analysts had expected the index to dip to 51.0 this month.
Meanwhile, the preliminary services purchasing managers’ index weakened to a seasonally adjusted 49.2 this month from 50.4 in April and worse than expectations for a decline to 50.2.
A reading above 50.0 on the index indicates industry expansion, below indicates contraction.
Commenting on the report, Jack Kennedy, Senior Economist at Markit said, “With GDP having stagnated in Q1, the PMI data so far suggest another disappointing performance in the second quarter.”
Following the release of the data, the euro added to losses against the U.S. dollar, with EUR/USD shedding 0.18% to trade at 1.3662, compared to 1.3673 ahead of the data.
Meanwhile, European stock markets were higher after the open. The Euro Stoxx 50 rose 0.2%, France’s CAC 40 eased up 0.15%, London’s FTSE 100 added 0.25%, while Germany's DAX picked up 0.3%.