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Eurozone Manufacturing Sector Contracts Less Than Estimated

The euro area manufacturing sector shrank slightly less than initially estimated in October, final data from IHS Markit showed Monday.

The factory Purchasing Managers' Index rose to 45.9 from 45.7 in September. According to flash estimate, the indicator held steady at 45.7 in October.

However, the indicator remained well below the 50.0 no-change mark signaling a rate of contraction that was the second-sharpest in the past seven years.

The survey showed sustained weakness in output, new orders and purchasing. Job cuts were reported for the sixth straight month with the latest pace of job shedding the sharpest since the start of 2013.

Chris Williamson, chief business economist at IHS Markit said, "The severity of the downturn, alongside poor trends in employment and prices is especially disappointing given the ECB's recent stimulus measures, underscoring how new ECB head Christine Lagarde is taking over the reins at a particularly difficult juncture for the eurozone economy."

Germany remained the principal source of manufacturing weakness in the region. The final PMI score came in at 42.1 versus 41.7 in September. The flash score was 41.9.

Meanwhile, France's manufacturing PMI improved to 50.7 from 50.1 in September as output grew the most since June. The initial PMI score was 50.5.

Spain saw its manufacturing PMI easing to a six-and-a-half year low in October. The manufacturing PMI fell to 46.8 from 47.7 in September.

At the same time, Italy's manufacturing activity shrank most since March. The manufacturing PMI slid to 47.7 from 47.8 in September.

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