Service sector PMIs from the Eurozone and the U.S and Brexit updates will be in focus today. Any further COVID-19 vaccine updates will also need monitoring.
French Services PMI (Nov) Final
German Services PMI (Nov) Final
Eurozone Markit Composite PMI (Nov) Final
Eurozone Services PMI (Nov) Final
Eurozone Retail Sales (MoM) (Oct)
German Factory Orders (MoM) (Oct)
IHS Markit Construction PMI (Nov)
It was a mixed day for the European majors on Wednesday, following Monday’s gains. The DAX30 and EuroStoxx600 fell by 0.52% and by 0.05% respectively, while the CAC40 ended the day up by 0.02%.
For the majors, concerns over a lack of progress towards Brexit pegged the majors back on the day. Also weighing on the majors and the DAX30, in particular, was news that the Democrats would retain the phase 1 trade agreement with China near-term.
There were positives, however, that provided support. News of the UK approving the BioNTech/Pfizer.inc vaccine delivered support, as did Joe Biden talk of a COVID-19 stimulus package.
According to reports on Wednesday, the President-Elect stated that delivering a COVID-19 stimulus package was an immediate priority.
It was a relatively busy day on the Eurozone economic calendar. German retail sales figures for October were in focus going into the European open.
According to Destatis, retail sales rose by 2.6% in October, reversing a 1.9% slide in September. Economists had forecast a 1.2% rise.
Unemployment numbers from Spain and the Eurozone released later in the day had a muted impact on the majors.
In Spain, the unemployment rose by 25.3k in September, following a 49.6k jump in August.
For the Eurozone, the unemployment rate slipped from an upwardly revised 8.5% to 8.4% in October. Economists had forecast an unemployment rate of 8.4%.
According to Eurostat,
ADP non-farm employment change figures were in focus late in the day.
In November, nonfarm employment increased by 307k, falling short of a forecasted 410k increase. In October, nonfarm employment had increased by 365k.
For the DAX: It was a mixed day for the auto sector on Wednesday. Continental slid by 1.56%, with BMW and Volkswagen falling by 0.39% and by 0.44% respectively. Daimler rose by 0.24%, however, to buck the trend on the day.
It was a bullish day for the banks. Deutsche Bank rose by 0.90%, with Commerzbank ending the day up by 1.81%.
From the CAC, it was a bullish day for the banks. BNP Paribas and Credit Agricole rose by 1.69% and by 1.67% respectively, with Soc Gen gaining 2.10%.
It was a mixed day for the French auto sector, however. Peugeot fell by 0.79%, while Renault rose by 1.45%.
Air France-KLM slipped by 0.85%, while Airbus SE rose by 2.15%, following Tuesday’s 1.90% gain.
It was a 2nd consecutive day in the green for the VIX, after having fallen for 5 consecutive days. Following on from Tuesday’s 0.97% gain, the VIX rose by 1.93% to end the day at 21.17.
Disappointing ADP nonfarm figures had limited impact, while plans to retain the phase 1 trade agreement with China was market negative. On the positive, however, remained progress towards a COVID-19 vaccine and hopes of a stimulus package to support the U.S economy.
For the U.S markets, it was a mixed day after Tuesday’s gains and last month’s rally. The Dow and S&P500 rose by 0.20% and by 0.18% respectively, while the NASDAQ slipped by 0.05%.
It’s a busy day ahead on the Eurozone economic calendar. Key stats include services and composite PMI numbers for Italy and Eurozone retail sales figures.
Finalized services and composite PMI figures for November are also due out for France, Germany, and the Eurozone.
We would expect the Eurozone’s composite and services PMI to have the greatest impact on the majors.
From the U.S, the all-important ISM services PMI and weekly jobless claims figures will also influence later in the day.
Away from the economic calendar, Brexit and COVID-19 news updates will need monitoring. Any further chatter on a stimulus package from Capitol Hill would influence.
In the futures markets, at the time of writing, the Dow Mini was up by 18 points.
For a look at all of today’s economic events, check out our economic calendar.
With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.