Euro zone manufacturing activity expanded slightly slower than first thought last month as further discounts at the factory gate failed to drive up new orders.
A second month of price cutting, along with only tepid expansion in Germany and contractions in France and Italy, will be disconcerting for the European Central Bank as it battles to prevent deflation.
Economic growth in the euro zone stalled in the second quarter. With inflation at just 0.4% in October, the ECB is facing pressure to introduce more stimulus measures.
Markit's final October manufacturing Purchasing Managers' Index was 50.6, beating September's 50.3 but shy of an earlier flash estimate of 50.7.
October marked the 16th month the index has been above the 50 line that separates growth from contraction.
An index measuring output, which feeds into a composite PMI due on Wednesday that is seen as a good indicator of growth, rose to 51.5 from September's 51, although that too was lower than the flash reading, which came in at 51.9.
"The performance of euro zone manufacturing remained broadly flat at the start of the final quarter," said Rob Dobson, senior economist at Markit.
"Manufacturing is therefore unlikely to provide any meaningful boost to the currency union's anaemic GDP growth," he added.
The latest PMI survey suggested this month will probably not be much better as orders fell, backlogs were run down and stocks of finished goods built up.
The new orders subindex was 49.5, barely above the flash and September reading of 49.3.
"Perhaps most worrying is the trend in new orders, a key bellwether of future output growth, which declined for the second month running," Dobson said. "It is hard to see any significant near-term boost to performance," he added.
Meanwhile, Spain's manufacturing sector expanded in October for the 11th month in a row, although the pace at which firms hired staff eased, echoing a slight slowdown in the country's economic recovery.
Markit's Purchasing Managers' Index (PMI) of manufacturing firms held steady at 52.6 in October, above the 50 mark that separates growth from contraction. Manufacturing production rose at the fastest rate since June.
But cuts in output prices partly explained a rise in new orders in October, firms surveyed by Markit said, to encourage sales as new export order growth slowed slightly.
Spain's emergence from recession was initially boosted by a strong bounce in exports, but faltering growth in neighbouring euro zone economies is dampening trade and raising concerns about the strength of the country's turnaround.
The Markit survey also highlighted other signs of a broader slowdown.
Spain's economy expanded for the fifth quarter running in the three months from July to September, with output growing 0.5% from the second quarter, below the 0.6% recorded for April to June.
Input costs fell slightly in October, which was also behind some of the price discounting to clients, Markit said.
