Spreadex Market Update
Non-farm afternoon looms as European indices hold onto their robust growth
A 7 month high UK construction PMI, with September’s reading at 59.9 against August’s 57.3, made sure the FTSE maintained its 80 point increase on the day, and helped stabilise the indices-boosting growth in the commodities sector. The Eurozone, meanwhile, ignored a worse than expected region-wide PPI figure to post their own healthy gains, with the DAX and CAC up 140 and 80 points respectively.
This afternoon then brings with it a particularly tricky non-farm report. 2015 has largely seen the US markets react negatively to strong data, especially the NFP figures. However, there have been signs that the Dow Jones et al. aren’t as averse to pro-rate-hike news as they have been previously; for example, hawkish comments from Yellen at the end of last week, alongside the better than forecast final Q2 GDP figure, were greeted with a warmer reaction than expected. It arguably suggests that investors would rather a clarity-providing lift-off than the perpetually indecisive Fed they have had to endure so far this year.
Of course, it isn’t out of the realms of possibility that the Dow will see a sharp downturn (or, more aptly, a muted response given the lack of impact today’s NFP number will likely have on the Fed) in the face of a strong non-farm figure, but that reaction looks far from the certainty it has been for most of the year. Currently the Dow futures are on the green side of tentative, suggesting an 80 point increase at the US open.
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