Whether its credit or Trump it’s a slowdown in China:
The latest Caixin China Composite PMI™ data (which covers both manufacturing and services) signalled only a marginal increase in overall Chinese business activity at the start of the fourth quarter of 2018. Furthermore, the Composite Output Index fell from 52.1 in September to a 28-month low of 50.5. The slowdown was broad-based by sector, with both services and manufacturing noting weaker performances compared to the previous month. Notably, manufacturing production stagnated, following increases in each of the preceding 27 months. Service sector activity meanwhile rose only marginally, with the seasonally adjusted Caixin China General Services Business Activity Index falling from 53.1 in September to a 13-month low of 50.8. The softer increase in services activity coincided with the first stagnation of new business for nearly ten years in October. A number of service providers commented on relatively subdued demand conditions at the start of the fourth quarter. At the same time, new orders placed with goods producers rose only slightly, following broadly no change in the previous month. As a result, composite new work increased at a marginal pace that was the weakest in 32 months.
Of course in upside down stimulus world, iron ore loved it.