The end of the third quarter yesterday saw the FTSE 100 index of leading shares enjoy the best three months in its 25-year history. The index, which has just closed at 5133.9 points, gained 21% between July and September.
Yesterday’s market fell following the release of the U.S economic data. What rattled investors’ cages yesterday was a report that showed the Chicago purchasing-manager’s index fell to 46.1 in September from 50 in August. A reading of 50 or higher indicates expansion; below that, contraction. The Chicago report isn’t usually a marketmover, as it’s more volatile than the national ISM reading, due out today. However it stirred some doubt about the economic recovery. Economists expect to see the ISM gauge to tick up to 54 from 52.9 in August.
The ADP report is closely watched as it comes out before the U.S government’s September jobs report, which is due out on Friday. Economists surveyed by Reuters expect to see that 180,000 jobs were lost this month, compared with 216,000 in August.
Today in the UK, at 8.30am the Purchasing Manager Index for Manufacturing (Sep) is released with the forecast to be 50.2. Euro-zone PMI data is also out today, forecast is 49.0. Data from the United States today is the closely watched weekly jobless claims report, which has been trending lower. This report, as well as Augusts’ personal income, September ISM and construction spending and pending home sales will also be stated.
The dollar continued on the defensive on Thursday, having resumed its downtrend in the previous session as investors sold the U.S. currency and went long on growth-linked currencies like the Australian dollar. The soft dollar helped drive up crude, gold and other commodity prices yesterday.
The UK market and the European markets have opened up flat. U.S futures markets are pointing to a slightly negative start when their markets resume trading this afternoon. Futures currently forecast the Dow to open down around 5 points; the Nasdaq and the S&P are set to open flat.
Sources: Reuters: BBC: Bloomberg: Lawshare: Deutsche Bank (db): Proquote: Financial Times: Wall Street Journal: CLSA: Sharescope: Market News. Capital Economics: CNBC: Wikipedia: GaveKal:
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