ETX Capital Daily Market Bite, 5th March, 2013: Markets Push Up On Data, Earnings
March 5, 2013 1:25 pm
March 5th, 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
Regional markets are putting on a decent performance this morning, helped by PMI services data from the UK and to a lesser extent the euro zone and a host of solid corporate news. UK PMI services, unlike manufacturing, surprised on the upside, to 51.8 — in the expansion zone and better than the 51 reading markets were expecting.
Conversely, the improvement in PMIs here may push the BOE to retain policies instead of pumping more QE — market expectations for more QE gained pace after the damp manufacturing report but today’s figure does put a twist on that. In the euro zone, PMI services were still depressed, below 50 but were revised up. Germany performed strongly versus other euro zone peers, reassuring investors that the region’s growth engine remains in an upward trend. That however does not change the case for an ECB rate cut this Thursday, as activity is on the whole, depressed and unlikely to change any time soon given the dire situation in Spain and Italy.
Retail sales from the euro zone were strong however, starting the year off in a solid fashion, rising 1.2% on the month versus calls for 0.8% on the month. Within the figures, France did surprisingly well and Germany, unsurprisingly led the advance. In terms of corporate news, RWE shares posted bumper gains after impressive FY earnings while Deutsche Post shares jumped after the group painted an optimistic outlook for this year. In the UK, Serco Group and Standard Chartered also registered strong gains after pleasing the market with numbers.
Looking ahead, we have US ISM non-manufacturing numbers which will be eagerly eyed following the services numbers from China and Europe. US markets are likely to start higher with the DJIA stock futures index currently trading up 33 points and the S&P500 up 3.8 points. Both indices are expected to extend previous session gains which saw the DJIA end at its second highest closing level ever. The index is not far off its all-time high at 14,198, registered back in 2007 –traders will be eyeing the figure, to see if the DJIA has enough steam to break above it.
March 5th, 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
Regional markets are putting on a decent performance this morning, helped by PMI services data from the UK and to a lesser extent the euro zone and a host of solid corporate news. UK PMI services, unlike manufacturing, surprised on the upside, to 51.8 — in the expansion zone and better than the 51 reading markets were expecting.
Conversely, the improvement in PMIs here may push the BOE to retain policies instead of pumping more QE — market expectations for more QE gained pace after the damp manufacturing report but today’s figure does put a twist on that. In the euro zone, PMI services were still depressed, below 50 but were revised up. Germany performed strongly versus other euro zone peers, reassuring investors that the region’s growth engine remains in an upward trend. That however does not change the case for an ECB rate cut this Thursday, as activity is on the whole, depressed and unlikely to change any time soon given the dire situation in Spain and Italy.
Retail sales from the euro zone were strong however, starting the year off in a solid fashion, rising 1.2% on the month versus calls for 0.8% on the month. Within the figures, France did surprisingly well and Germany, unsurprisingly led the advance. In terms of corporate news, RWE shares posted bumper gains after impressive FY earnings while Deutsche Post shares jumped after the group painted an optimistic outlook for this year. In the UK, Serco Group and Standard Chartered also registered strong gains after pleasing the market with numbers.
Looking ahead, we have US ISM non-manufacturing numbers which will be eagerly eyed following the services numbers from China and Europe. US markets are likely to start higher with the DJIA stock futures index currently trading up 33 points and the S&P500 up 3.8 points. Both indices are expected to extend previous session gains which saw the DJIA end at its second highest closing level ever. The index is not far off its all-time high at 14,198, registered back in 2007 –traders will be eyeing the figure, to see if the DJIA has enough steam to break above it.
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