Despite some solid jobs data ahead of today’s NFP reading the US$ has so far been unable to stage any recovery as the theme of general weakness continues in the first trading weak of the new year. The ADP report showed 250k growth in private sector jobs in December, well above expectation of 190k, while the initial jobless claims rose 5k to 250k in the final week of December. Earlier in the day, the Markit Services/Composite PMIs were released and Markit Manufacturing/Services/Composite PMIs noted that “a stellar end to 2017 for the EU rounded off the best year for over a decade”, which underpinned the Euro and kept the dollar under pressure. The Eurozone PMI services were revised up by 0.1 to 56.6 in December, while the German PMI services were unrevised at 55.8. The French Services PMI was revised lower by 0.3 to 59.1and the Italian PMI figure dropped 0.1 to 54.6 in December but both remained well above their long term trend, while the UK PMI services rose to 54.2 in December, up from 53.8 and beat expectation of 54.0.
In other markets, US stocks roared to yet new highs after the strong private hiring jobs growth and global growth hopes. Oil also remains strong due to the increased hopes of continued economic growth while the metals remain firm on the back of the weaker dollar and improving risk sentiment.
Friday will commence with the Australian HIA New Home Sales and the November Trade Balance (exp +$915 mio). Europe will initially look to the German Retail Sales for guidance ahead of the Provisional EU December CPI (exp 1.3%; Core, 1.0%) and PPI (exp 0.3%mm, 2.4%yy). The main focus though will be on the US unemployment (4.1%)/NFP (+19K)/Average Hourly Earnings (0.3%), which comes ahead of the ISM Non-Mfg and Factory Orders as well as speeches from the Fed’s Harker/Mester and the BOEs Haldane. Have a good weekend.
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|ASX SPI: 6056|