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Spotlight on the ECB

Published Thursday, March 5th, 2015

With caution taking hold as markets readied themselves for today’s additional details on the ECB’s QE package and tomorrow’s all-important US jobs data, investors had the latest batch of services data to digest as the search for clues of a pick-up in global economic growth went on. The day started on a positive note as sentiment was supported by a small rise in China’s February HSBC services PMI which bolstered hopes that recent efforts to stimulate its slowing economy may have started to pay dividends. The upbeat tone was maintained when equivalent figures from the eurozone revealed an improvement in service sector activity growth and help the broader composite reading climb to a seven-month high.

The US non-manufacturing sector also enjoyed an expansion in activity though this was not reflected on Wall St where indices eased further away from multi-year highs. The culprit for this bout of risk aversion was seen by many as the ADP jobs survey which missed expectations of 219,000 to show 212,000 jobs were added last month. The pullback in risk appetite may however have been overdone as the data still sets the scene for a solid reading of+200,000 for tomorrow’s non-farm report. Such concerns were not mirrored by the dollar index which maintained its upward trajectory, helped in large part by the euro’s woes after it shed 0.9% yesterday and is struggling to hold the $1.10 level this morning ahead of the ECB policy meeting.

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Posted by Stephen Brennock

Stephen Brennock joined PVM in 2013 after having worked as a project manager for a business development firm. He graduated with a degree in Business Management in 2007.