US Economy Growing Strong at 6.4% amid Pandemic

Shares rose in early European trading on Friday, after retreating in Asia, as the latest batch of economic data provided mixed signals about prospects for the recovery from the pandemic.

Two surveys released on Friday showed that Chinese manufacturing expanded in April but growth appeared to be slowing. Figures showed Europe's economy contracted in the first three months of the year, while the U.S. economy steamed ahead, growing at a 6.4 per cent annual pace. Major recent Coronavirus outbreaks and slow progress in vaccinations are adding to worries about the outlook for economies in Asia and Europe.

France's CAC 40 inched down less than 0.1 per cent in early trading to 6,300.06, while Germany's DAX added 0.4 per cent to 15,212.91. Britain's FTSE 100 added 0.3 per cent to 6,982.92. U.S. shares were set for a slow start, the future for the Dow industrials down nearly 0.2per cent at 33,900. S&P 500 futures fell 0.2per cent to 4,193.12. The contraction in the 19 countries that use the euro currency compares to a robust rebound underway in the United States. The second straight quarter of falling output, following a contraction in the fourth quarter of 2021, confirms Europe's double-dip pandemic recession. Two-quarters of falling output is one definition of a recession.

Chinese manufacturing expanded in April but growth might be slowing after a rebound from the Coronavirus pandemic, surveys showed. Economic growth in the first three months of 2021 slowed to 0.6 per cent over the previous quarter. A monthly purchasing managers' index issued by the business magazine Caixin rose to 51.9 on a 100-point scale from March's 11-month low of 50.6 on a 100-point scale on which numbers above 50 show activity expanding. A separate survey released by the Chinese statistics agency and an industry group declined by 0.8 points to 51.1 but still was above the 50-point mark showing activity growing. A sub-index of production fell 1.7 points to 52.2. That suggests “growth momentum will wane this year,” Julians Evans-Pritchard of Capital Economics said in a report.

In Asian trading, Japan's benchmark Nikkei 225 dipped 0.8 per cent to finish at 28,812.63. South Korea's Kospi slipped 0.8per cent to 3,147.86. Australia's S&P/ASX 200 fell 0.8per cent to 7,025.80. Hong Kong's Hang Seng lost 2.0 per cent to 28,724.88, while the Shanghai Composite slipped 0.8per cent to 3,446.86. Japan and China are heading into multiple holidays known as “Golden Week" that will likely slow much market activity in the coming days.

The Commerce Department said Thursday that the U.S. economy grew at a brisk 6.4 per cent annual rate in the last quarter and is likely to accelerate further as more vaccinations are administered and Covid-19 cases continue to fall. Meanwhile, the Labor Department said the number of Americans who filed for unemployment benefits fell again last week.

In another trading, benchmark U.S. crude fell 60 cents to $64.41 a barrel in electronic trading on the New York Mercantile Exchange. It picked up $1.15 to $65.01 per barrel on Thursday. Brent crude, the international standard, lost 51 cents to $68.05 a barrel. In currency trading, the U.S. dollar fell to 108.90 Japanese yen from 108.93 yen. The euro fell to$1.2097, down from $1.2122.