Tuesday preview: Eurozone inflation, global manufacturing PMIs set for release

Economic data will be on investors' minds on Tuesday in the absence of any scheduled corporate earnings, with manufacturing purchasing managers' indices (PMIs) and a key inflation reading from Europe due out during the session.

As for the manufacturing data, it will be the secondary releases of September PMIs from the UK, eurozone and US, so the market reaction is likely to be muted following the initial readings published a week ago.

The flash reading of eurozone consumer price inflation is scheduled for release at 1100 BST and is predicted to show that price growth slowed to below the European Central Bank's 2% target in September. After hitting a three-year low of 2.2% in August, the annual inflation rate is expected to have eased to 1.9% – its lowest since June 2021.

Alexander Valentin, senior economist at Oxford Economics, said that "eurozone inflation to be released tomorrow will undershoot expectations more than previously anticipated", as a result of slowdowns in national inflation figures already released across Italy, Spain, France and Germany.

"Markets have shifted their expectations for further rate cuts as recent survey data suggest a weaker growth outlook for the eurozone. [...] We think these developments may provide ECB doves with sufficient reason to argue for an October rate cut."

In the UK, the secondary reading of the S&P Global/CIPS manufacturing survey at 0930 BST is expected to confirm initial figures of 51.5, pulling back from a two-year high of 52.5 in September. Growth had slowed down the previous month, with clients cited as adopting a cautious approach to spending ahead of the Autumn Budget.

The final release of the eurozone HCOB manufacturing PMI due out at 1000 BST is also predicted to confirm last week's numbers, that activity in the sector contracted at its sharpest rate all year in September (44.8, down from 45.8 in August) and continues to be a drag on overall economic growth.

Meanwhile, the S&P Global US manufacturing PMI, scheduled for 1445, is expected to show no change from the initial release, with the PMI having fallen to a one-year low of 47 from 47.9. However, we'll get our first look at the ISM manufacturing PMI for September, which is tipped to rise to 47.5 from 47.2 – though still firmly in negative territory (indicated by any number under 50).

Also in focus in the US will be the JOLTS job openings survey and construction spending data due out at 1500 BST.

Tuesday October 01

QUARTERLY PAYMENT DATE

Blackrock Salt

INTERIM DIVIDEND PAYMENT DATE

Totalenergies, Rtc Grp., Shaftesbury Capital, Rathbone, Jpm Uk Sml Cap

FINAL DIVIDEND PAYMENT DATE

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SPECIAL DIVIDEND PAYMENT DATE

Base Resources

UK ECONOMIC ANNOUNCEMENTS

PMI Manufacturing (0930)

INTERNATIONAL ECONOMIC ANNOUNCEMENTS

PMI Manufacturing (GER) (0855), PMI Manufacturing (EU) (0900), Consumer Price Index (EU) (1000), PMI S&P Manufacturing (US) (1445), ISM Manufacturing (US) (1500), ISM Prices Paid (US) (1500)

GMS

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