Markets | 05/09/2014 | Non-farm payrolls to shift sentiment

Markets across most of Asia have finished the week’s final session fractionally lower although there has been something of a stand-out performance from the Shanghai Composite index. An abundance of liquidity in the local money market – and an absence of IPOs this week – is being seen as the reason why Shanghai has managed to tack on around 0.8% today and almost 6% over the last five session, despite that worse than expected PMI data at the start of the week.

Wall Street futures are currently indicating a flat start to the session although we do have the non-farm payrolls to contend with and these could easily serve to shift sentiment. Expectations are for another 200,000 jobs to have been added but with the prospect of tighter monetary policy now looming, the big risk has to be that business confidence takes something of a knock. However given the August ISM non-manufacturing print edged a little higher, it does seem as if the economy remains healthy and many will be willing to overlook the fact that the ADP payroll reading came in slightly below expectations. For now anyway, we’re calling the DOW down 2 at 17068 and the S&P down 2 at 1996.