Daily Market Report - 03/02/2016


The UK construction sector slowed in January to its weakest level for nine months. With the Markit construction purchasing managers' index (PMI) falling to 55 from 57.8. Economists had forecast for a reading of 57.5. The construction PMI release was in contrast to a stronger-than-expected start for the manufacturing sector published on Monday.
Markit economist Tim Moore said "Taken together with the slowdown in new order growth, the latest survey suggests that construction companies are braced for a relatively subdued first quarter." Optimism among construction companies waned to its lowest level since December 2014, the survey showed. "Some firms highlighted concerns that underlying demand conditions had started to soften."


In the Eurozone, the unemployment rate dropped in December to its lowest rate in over four years despite worries about the global economy. Eurostat the EU's statistical agency, reported the jobless rate in the eurozone fell to 10.4% from 10.5% in November. This means 16.75 million people are jobless, which is down 49,000 from November.
Greece and Spain continue to have the highest jobless total at over 20%, with Czech Republic and Germany having the lowest rate, both at 4.5%. Jennifer McKeown, Capital Economics analyst, welcomed the improvement, but said “A slowing global economy could reverse any progress.” ECB President Mario Draghi has already indicated another stimulus package could be unveiled as soon as next month.

Key Announcements

09:30 – GBP – Services PMI – expected to fall to 55.4 from 55.5
13:15 – USD – ADP Non-Farm Employment – expected to fall to 193K from 257K
15:00 – USD – ISM Non-Manufacturing PMI – expected to fall to 55.1 from 55.3