It’s been a rather volatile start
for trade across Europe with the initial reaction having been one of taking the
lead from last night’s disappointing finish on Wall Street, but some broadly
better than expected German and Eurozone PMI data has given equity markets
something to cheer. It wasn’t universally positive, but all the key readings are
now above the break even 50 point, giving traders a degree of assurance that
perhaps the wheels aren’t about to fall off – at least not just yet, anyway.
The decision has also been taken to overlook the rather disappointing PMI
numbers we’ve seen come out of France this morning, although the weakness here
has arguably been priced in already.
It’s been a rather muted session in
Asia too, with equity markets taking direction from Wall Street and failing to
find any meaningful lift off the back of the better than expected Chinese
manufacturing PMI print. However with these threads of hope coming through in
the European economic data, it can be no surprise that the Nikkei has jumped
markedly in after hours trade and assuming we can maintain this degree of optimism,
we’re going to be looking at a positive start to Friday’s session.
That Eurozone PMI data is also
helping boost US futures prices, with the S&P having rallied up from around
1,930 shortly after European trade commenced. Again we have more earnings news
on the cards whilst the US manufacturing PMI data will also be closely followed
– momentum has been building here so any shortfall could serve to knock
equities back shortly after the open. Yesterday’s shooting in Canada is a stark
reminder of the rather fraught geopolitical situation we’re facing right now
and was responsible for pushing markets significantly lower yesterday, but if
this remains an isolated event and the macroeconomic factors continue to
deliver then there’s perhaps some hope that the sell off could be at an end.
Ahead of the open we’re calling the DOW up 134 at 16595 and the S&P up 16
at 1943.
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