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Mixed US data to round off the week; US500 looking for best week in over a year

Summary:

  • ISM non-manufacturing PMI 55.9 vs 57.6 exp and 57.4 prior
  • US factory orders M/M: +1.3% vs +1.1% exp and 0.4% prior
  • USD possibly taking first tentative steps to recovery

The final economic data of note this week from the US has given mixed messages with the ISM non-manufacturing PMI missing forecasts but the latest US factory orders have risen by more than expected. Whilst both of these are far less influential than the earlier NFP report, they can sometimes move the markets.

First off, let’s begin with the IMS non-manufacturing number which has come in at 55.9 against consensus forecasts for 57.6 and a prior reading of 57.4. The survey which relates to the services sector is in contrast to the latest manufacturing survey from ISM which showed on Wednesday an above forecast reading. Whilst 55.9 is something of a disappointment it remains well above the 50 level marking the line between expansion and contraction and after some immediate downside in the US dollar following the release it has regained it poise and is higher against the majority of its peers on the day. 

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 The USD is making steady gains today despite some disappointing data with only CAD and crypto markets making significant gains against the Buck. Source: xStation

At the same time as the ISM data the US factory orders for November were released and these beat forecasts in rising by 1.3% M/M. This was a bigger gain than the +1.1% M/M expected and represent a decent rise on the 0.4% prior reading (revised higher from -0.1%). 

With the US dollar looking to recover it may be worth looking at the stock markets and seeing how they are performing. The US500 has extended its recent gains today with the market taking out previous highs to move up into uncharted territory once more. It’s been a good week for equity bulls with the JAP225 having its largest weekly gain since July, the DE30 on course for its best week since April and the US500 looking like it may post its best week since Dec 2016. 

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The US500 is looking set to post its largest weekly gain in more than a year. Source xStation

 

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