Stocks have best January in years

The UK January purchasing managers' index for manufacturing came out yesterday and surprised by climbing from 49.7 in December to 52.1. Any reading over 50 suggests growth and this is the highest since last May.

Kieran Salsone

WHISPER it low, but stock markets around the world have had the best January for 18 years.

The MSCI all-country world index is up 5.8 per cent, while bank shares are up nearly 10 per cent. And all this has happened despite the ongoing travails of the eurozone, travails that will doubtless continue for many months yet.

This revival of optimism does of course follow a profound loss of confidence last year. It is easier to have a great leap forward if you start from a fair way back. Still, it is marked enough and widespread enough to be worth respecting, and from our own narrow national perspective it is welcome.

This recovery in confidence has been spurred by an uplift in industrial sentiment. It is pretty widespread.

The UK January purchasing managers' index for manufacturing came out yesterday and surprised by climbing from 49.7 in December to 52.1. Any reading over 50 suggests growth and this is the highest since last May.

As you can see, this is not wild optimism by comparison with the days immediately post-recovery, but expansion is better than contraction. Companies in other countries have reported a similar lift in their mood.