Daily Market Report 05/03/2014


News that Russian troops close to the Ukraine border will return to their camps by Friday meant stock markets pulled back some of Monday’s losses on Tuesday, gold prices, oil and the Yen all fell.


The UK construction industry showed resilience in February despite heavy rain and flooding last month. Markit’s construction PMI fell back to 62.6 from 64.6 in January which was the highest since August 2007. This shows strength in the UK construction industry at present because despite the poor weather conditions there was still solid growth.

Building firms reported the flooding which struck parts of the UK did hit efforts to build news homes as house building fell to a four month low.


The only real data out from Europe yesterday was in Greece where their manufacturing PMI increased to a 66 month high of 51.3, up from 51.2 the previous month.


We have data already released this morning with Markit services PMI data from the Italy, France, Germany and the Eurozone as a whole all expanding more than the previous month as well as exceeding expectations.

On top of this economic growth in the Eurozone for the last quarter for 2013 came in higher than the previous quarter from 0.1% to 0.3% and retail sales came higher at 1.3% for January. The euro showed little gains from the back of this as markets are probably reluctant to take a position ahead of tomorrow’s monetary policy press conference by Mario Draghi of the European Central Bank.

UK services continued to grow strongly in February albeit at a slightly slower pace than January with job growth in the sector increased at its fastest rate since 2007. All in all the data has been interpreted very positively by analysts, suggesting that the UK economy would grow at its fastest this year since 2007. The impact on the pound however has been surprisingly minimal with very small gains for the currency.

Later this afternoon the US will come into focus with ADP payroll figures expected to show that only 153,000 jobs were added in February, 22,000 lower than January; which could cause the US dollar to weaken.

Key Announcements:

12.00pm – USD – Mortgage Applications (Feb 28): Previously at -8.3%.

13.15pm – USD – ADP Employment Change (Feb): Expected to show an additional 153,000 jobs were added.

15.00pm – CAD – BoC Interest Rate Decision: Expected to remain at 1%.

15.00pm – USD – ISM Non-Manufacturing PMI (Feb): Expected to remain at 54.5