It is non-farms Friday, just what you need after a somewhat manic European Central Bank Thursday. The press conference didn’t deliver for traders yesterday, and reports that not all at the ECB are happy with picking up some assets in the periphery’s garage sale is hardly surprising.
For some in Germany their bank holiday will be a welcome respite. We are still making our DAX market despite the underlying being closed, and it has clawed back around a third of yesterday's fall this morning.
With QE finishing up this month, in the US it is all about interest rate expectations when we look at non-farms. With the dollar retreating from its highs, a strong number north of 200k is expected to help push it back and heap further pressure on the yen and euro.
The UK market is taking the opportunity to bounce in a fairly broad way, although insurer RSA (-1.5%) and the UK’s en vogue punching bag Tesco (-1.2%) are among the dozen or so names sitting out the rally. RSA is lower after a round of refinancing, that has raised some eyebrows from analysts as to its ease, and Tesco is still suffering from a negative bout of the Buffet effect.
easyJet comfortably leads the way today and is chasing its pre-summer price levels. No immediate signs of worry from Ryanair’s move into the business market, and disruption in France and the effect of a strong summer have been welcomed by shareholders today.
Having had a much better time yesterday than equity markets in Europe, today we are expecting the Dow Jones to open strongly, up 70 at 16,870.