Daily Market Report 05/12/2013


Markit's November Eurozone Composite Purchasing Managers' Index (PMI) fell slightly to 51.7 from 51.9 in October. This was the fifth month in a row we have seen activity rising.

Despite Germany’s positive figures, France and Italy's decline last month meant that the overall Eurozone private sector grew at a slower rate in November than October. It also suggests that the core countries at the heart of the Eurozone are increasingly diverging.


Data firm Markit reported that the UK Services PMI came in at 60.0, down from October's 16-year high of 62.5. This sector is still expanding and it beats all the major Eurozone countries even though the activity compared to early autumn has eased and suggests the economy is still expanding.


Some positive jobs data for the US as American employers hired 215,000 workers in November, according to figures from data agency ADP. This was up from the figures last month showing 185,000 hires in October. This could also suggest that non-farm payroll figures out Friday could also be positive

The trade deficit (difference between imports and exports) was also better than last month coming in at –US$40.64 Billion. Sales of goods to China, Canada and Mexico were the highest ever; pointing to improving global demand that will benefit American manufacturers. Purchases of products from the European Union also climbed to a record in October.

There was also some slightly disappointing news showing The Institute for Supply Management’s services index decreased to 53.9 in November from 55.4 in the prior month


Tomorrow Sees the ECB and BoE both release their interest rate decisions for the month of November. With both expected to remain unchanged this should do little to move currency markets. A close eye will be kept on the notes and justification of these decisions to help give some insight as to what may happen in the coming months.

At 13.30pm George Osborne from HM treasury will release the government’s autumn statement. This document provides an updated economic outlook and previews the government's budget for the coming year, including  tax levels, expected spending,  and income levels, borrowing levels, and government  financial objectives.

The US will also release its GDP figures for the third quarter expected to show an annualized 3% rise. Initial jobless claims are also due to be released at the same time. We could see some dollar strength if this date meets or exceeds expectations.

Key Announcements:

12.00pm – GBP – BoE Interest Rate Decision: Expected to remain at 0.5%.

12.00pm – GBP – BoE Asset Purchase Facility: Expected to remain at £375bn.

12.45pm – EUR – ECB Interest Rate Decision: Expected to remain at 0.25%.

13.30pm – EUR – ECB Monetary Policy Statement.

13.30pm – GBP – Autumn Forecast Statement.

13.30pm – USD – GBP Annualized (Q3): Expected to increase to 3%.

13.30pm – USD – Initial Jobless Claims (Nov 29): Expected to increase to 325,000.

15.00pm – USD – Factory Orders (Oct): Expected to worsen -1%.