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PMI data comes in strong, but inflation worries boost gold and prevent stocks from reaching records so far, Powell faces possible re-nomination

Eurozone business activity growth slowed sharply to a six-month low in October amid increasing supply bottlenecks and ongoing health concerns, dropping most markedly in manufacturing though also cooling in services. Survey-record price increases were meanwhile reported as firms sought to pass an unprecedented rise in costs on to customers.

While job creation accelerated to the joint-highest in 21 years as firms boosted capacity to meet demand, optimism about the outlook was hit by supply concerns linked to the pandemic in manufacturing in particular. Flash Eurozone PMI Composite Output Index at 54.3 (56.2 in September). 6-month low. Flash Eurozone Services PMI Activity Index at 54.7 (56.4 in September). 6-month low. Flash Eurozone Manufacturing PMI Output Index at 53.2 (55.6 in September). 16-month low. Flash Eurozone Manufacturing PMI at 58.5 (58.6 in September). 8-month low.

U.S. private sector businesses recorded a sharp and accelerated upturn in output led by the service sector during October, with growth the strongest for three months, albeit still much weaker than seen earlier in the year. However, October also saw a survey-record rise in backlogs of work as firms struggled to meet demand due to supply chain bottlenecks and labor shortages, in turn driving the steepest rise in prices yet recorded by the survey. Flash U.S. Composite Output Index at 57.3 (55.0 in September). 3-month high. Flash U.S. Services Business Activity Index at 58.2 (54.9 in September). 3-month high. Flash U.S. Manufacturing PMI at 59.2 (60.7 in September). 7-month low. Flash U.S. Manufacturing Output Index at 52.3 (55.7 in September). 15-month low.

Gold futures aimed high last Friday with possibly the highest weekly rise since the month of May due to investors increasing concerns over inflation and decline in purchasing power.

Gold was up 1.4% last week alone with a possibility of maintaining the 1800$ price per oz. Silver, another sought-after precious metal, is up for a 5th consecutive week.

US stock prices were shaky at the start of the trading session on Friday. While DJ30 composite managed a 0.32% increase and S&P500 is up 0.08% NASDAQ100 is down 0.35% due to unsatisfactory showings from Intel and their underperformance in sales. Additionally, other tech-orientated companies like Alphabet Inc., Pinterest Inc., and Twitter Inc, and Facebook Inc. were down due to fears of over-regulation for ad spending which can impact their profitability in a negative way.

Friday also marked the last official speech for the month of October headed by US FED Chair Jerome Powell. He is also facing re-nomination again as Chair. The decision itself is likely to be taken in November as his term would expire on the 5th of February 2022. While he is the likely favorite there is a possibility that a more dovish candidate could take charge with interest tapering being extended beyond 2022 or even 2023.