UPDATE 1-Euro zone factory growth speeds up; Spain, Greece lag

(Adds details, analyst comment, market reaction)

* Manufacturing PMI revised up to 30-month high

* Manufacturing output at 35-month high

* Manufacturing new export orders at 3-year high

By Jonathan Cable

LONDON, March 1 (BestGrowthStock) – Manufacturing activity in the
euro zone grew slightly faster than previously thought last
month but Spain and Greece continued to lag far behind the
bloc’s big three economies, a survey showed on Monday.

The Markit Eurozone Manufacturing Purchasing Managers’ Index
for February jumped to 54.2 from 52.4 in January, nudging up
from a flash estimate of 54.1 released late last month.

This is the fifth consecutive month the index has been above
the 50.0 mark that divides growth from contraction and is its
highest reading since August 2007. The output index notched up a
near 3-year high, rising to 57.0 from January’s 56.0.

But markets were little moved on the release.

Earlier data from Germany, the 16-nation bloc’s biggest
economy, showed activity there expanded at its fastest pace in
32 months while in Italy the PMI was just shy of January’s
28-month high. The France PMI slipped to 54.9.

In Spain, manufacturing activity contracted for the 27th
month, although was closer to stabilising.

The Spanish PMI jumped to 49.1 from January’s 45.3. Business
conditions for Greek manufacturing worsened in February, with
the index falling to a 10-month low of 44.2.

“The overall figure is encouraging, benefitting from the
global recovery. (But) those very weak Spanish and Greek figures
are still in pretty dire straits. They are in for a tough time,”
said Ben May at Capital Economics.

The UK manufacturing sector expanded faster than expected in
February, matching the previous month’s 15-year high rate of
growth.

Earlier data showed factory activity in Asia’s main
economies expanded last month, with India and South Korea
growing at their fastest pace in around two years although China
showed some signs of weakening.

For a graphic see:

http://graphics.thomsonreuters.com/310/GLB_MPMI0310.gif

The Markit report showed new export orders grew at the
fastest rate in three years, with the index jumping to 56.0 last
month from January’s 53.8, helped by a tumbling euro and
companies restocking warehouses.

The euro zone economy grew 0.4 percent in the third quarter
of 2009, emerging from five consecutive quarters of contraction,
its worst post-war recession.

It grew by 0.1 percent in the final three months of last
year and economists polled by Reuters predict modest growth over
the coming year. [ECILT/EU]

The euro (EUR=: ) has fallen to nine-month lows in recent
days, battered down by worries over heavily indebted smaller
euro zone countries such as Greece and Portugal.
Stock Investing

(Editing by Andy Bruce and Toby Chopra)

UPDATE 1-Euro zone factory growth speeds up; Spain, Greece lag