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[QUOTE="Alpari UK, post: 64017, member: 31079"] [b]US Opening Call from Alpari UK on 4 June 2014[/b] [B]US ADP and PMI readings cap off data packed day[/B] [LIST] [*]Investors appear to be positioned ahead of tomorrow’s ECB decision. [*]Eurozone PMI readings disappoint, weighing on sentiment; [*]US ADP and services PMI readings key today. [/LIST] We’re seeing another negative session in Europe on Wednesday, with the FTSE currently down 23 points, the CAC down 27 points and the DAX down 46 points. Over in the US, futures are pointing to a similar open with the S&P seen 3 points lower, the Dow 24 points lower and the Nasdaq 7 points lower. I get the feeling that investors have now positioned themselves ahead of the ECB meeting tomorrow, making any significant gains before then potentially difficult to come by. Evidence of this can be seen in equity markets which have edged lower over the last couple of days, despite the consensus being for the ECB to announce stimulus of some kind. The response to the CPI readings over the last couple of days further supports this, with traders buying the euro despite inflation being below expectations. It is possible that this also reflects the fact that investors are realising they’ve priced in too much and while ECB President Mario Draghi has a good record of getting traders excited about future stimulus, he generally disappoints where it matters, providing stimulus. The euro is down around four cents against the dollar since the previous meeting. Draghi has backed himself into a corner and on this occasion, must deliver. The economic data this morning has done little to provide a positive spark for traders. The services PMIs disappointed in much the same way that the manufacturing data did on Monday, with all but one reading falling short of expectations. On a more positive note, only the French reading is still in contraction territory, in both cases, so confidence is improving among businesses. The eurozone composite PMI, which accounts for both manufacturing and services, now stands at 53.5, only marginally below the three year high readings seen in recent months. If we need a positive to latch onto, there it is. While people’s attention is predominantly on the ECB ahead of tomorrow’s decision, there is some important data being released today which I expect will have some market impact. You can never turn a blind eye to the major economic releases from the US, particularly those that provide an estimate of Friday’s non-farm payrolls figure or give an indication of confidence within the country’s largest and most important sector. The ADP non-farm employment change reading is not necessarily known for its accuracy. In fact, the number itself can usually be discarded. What we look for in this reading is a big surprise to either the upside or the downside that would suggest the same is likely when the official NFP figure is released on Friday. The services and ISM non-manufacturing PMIs are followed very closely each month as the US is very dependent on this sector, which makes up more than two thirds of total output. Both are expected to show a small uptick in May and even small differences in the number can get a visible reaction in the markets. It is extremely important that we see this sector perform well for the rest of the year follow such a disappointing first quarter. Confidence is key during a recovery and a strong services sector can provide this. [/QUOTE]
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