Europe chems sector confidence steadies after volatile few months – CMCI
Tom Brown
27-Sep-2016
LONDON (ICIS)–Confidence of European chemicals sector
players in current and medium-term market conditions
stabilised in September after a volatile few months for the
sector, according to ICIS data on Tuesday.
Market player assessment of the current state of the market
compared to the same period a year ago skewed towards a
favourable consensus, and expectations for business
conditions in 12 months are broadly expected to be better
still.
The consensus represented a general improvement on sentiment
over the last few months, on the back of broadly positive
macroeconomic indicators, but more muted than during more
volatile periods in the wake of the UK Brexit vote in late
June.
In August, the market assessment of current business
conditions was more strongly positive, but expectations for
the next 12 months were far bleaker.
Demand and profitability expectations were more restrained
despite the optimism for overall market conditions, while
overall profitability is also expected to be slightly lower
in 12 months compared to the present.
Market uncertainty has gradually dissipated following the UK
referendum on EU membership, as it became apparent that no
significant disruption to the union is expected for the next
couple of years as policymakers in London and Brussels begin
to deliberate over the form the UK’s exit will take.
Market jitters and private sector output contractions in the
UK in the immediate aftermath of the vote, with the country’s
manufacturing sector reporting order book some of the
strongest rallies in order book volumes in years, according
to analyst Markit.
Eurozone manufacturing sector output also improved in August,
albeit more slowly, as strong improvements for German and
Spanish private sector demand were balanced against modest
contractions for Italy and France.
The newly established ICIS Europe CMCI aggregates
sentiment from hundreds of petrochemical market players
actively involved in price negotiations across more than 60
different markets.
The Europe CMCI runs from +100, to -100, with zero on each index representing neutral, or uncertain conditions, a negative score indicating bearish expectations and a positive score representing bullish expectations. The indices also gather sentiment on the comparison between the current situation and the situation across the past 12 months to give a complete picture of current market conditions and confidence. The information is gathered in the third week of each month. A full methodology is available on request.
For more details on the overall Europe CMCI data,
click here
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