Still slipping in Q2

China : PMI Composite

HSBC China Composite PMI, which covers both manufacturing and services, indicated an expansion of Chinese business activity in April but at a weaker pace. Activity growth slowed to a three month low with a reading of 51.3, down from 51.8 in March. The slower expansion of total business activity was largely driven by a stagnation of manufacturing output in April, following three months of growth.

Another weak forecast for Friday’s employment report:

ADP Employment Report

ADP correctly signaled a weak employment report for March and it’s signaling another weak report for April, at only 169,000 for its private payroll gauge which is far under the Econoday concensus for 205,000 and just under the low estimate for 170,000. ADP’s estimate for March is now revised 14,000 lower to 175,000. For comparison, the Econoday consensus for private payroll growth in Friday’s employment report is 223,000 with the low estimate at 170,000. ADP doesn’t always move the markets but it may today, raising talk of another soft employment report on Friday

This tells me business has more employees than it needs and most likely will adjust accordingly:

Productivity and Costs