Ignorant, oblivious or uncaring about the domestic situation in the USA, investors instead focused on a gangbusters Caixin services PMI out of China, extending the month’s early rebound.
Coming in at 55.0, the PMI was way ahead of the 47.4 forecast AND the previous month’s 44.4, showing a sharp return to growth for the sector across May.
That was a huge boost to Europe. The FTSE added another 0.9%, pushing the index to a near 3-month peak of 6275. It would have been higher, however, if the pound weren’t continuing to rebound itself.
Though the ongoing Brexit talks seem frosty at best, outright hostile at worst, cable rose 0.4% to $1.2588, its best price in close to 7 weeks.
It remains to be seen whether the pound can keep hold of that growth in the face of another weak UK services PMI, one that is expected to see the final reading for May revised marginally higher, from 27.8 to 27.9.
The Eurozone indices showed the FTSE what it was missing out on. The DAX shot up by 230 points, rocketing past 12200 for the first time since the very start of March. As for the CAC, a 1.8% surge left it above 4930.
Tacitly pleased by the use of force on US protestors, the Dow Jones has not paid one iota of attention to its domestic troubles. Instead the index has kept rising, and is expected to continue to do so this afternoon, with the futures pointing to a 145 point increase. That would leave the Dow just shy of 25900, a level last seen on March 6th.
Standing between now and then is the ADP (NASDAQ:ADP) nonfarm employment change reading, one that is set to indicate another 9 million jobs were lost in May. Unemployment isn’t something investors have been shown to care about, however, so it may not affect the Dow’s chances of a fresh high.
"Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.
In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved."