Slightly better-than-expected overnight Chinese manufacturing PMI data that has just edged into growth has failed to encourage the FTSE into positive territory this morning. The release of the equivalent data for both the UK and the US has ensured that enthusiasm has been tempered. If ever an example of how the UK likes to see itself as different to its cross-channel counterparties, the insistence on having the bank holiday on the far side of this weekend and not on May Day looks like the perfect representation.
By this time next week the votes will be counted and IG's general election binary is still clearly indicating at 90% that there will be no majority. What is less clear is what might be shown up in the political haggling that will ensue after these results; IG's general election binary is indicating that the Conservatives have edged up to 290 seats while the Liberal Democrats are now hovering around 25 seats and this brings the joint total to 315 seats, a stone's throw away from the magic 326 number and a return to the previous coalition looking a real possibility. Currently the most likely outcome, a 37% chance of a Labour minority government, might not be as nailed on as previously thought.
Today it is the turn of Lloyds to post its figures much to the cheer of UK taxpayers with their 21% stake in the bank looking to be paying dividends as the bank's first-quarter figures have come in better than expected. Even the £660 million cost of stripping out of TSB has not prevented the bank from staying on course to offer dividend yields of 3.5% by years-end. If the market perception that by the end of 2016 Lloyds can yield 5.3% stays true, it should prove suitably attractive for institutions to take the balance of the government's exposure away.
Since its IPO Virgin Money has made rapid progress in adding value for investors and today’s first-quarter figures highlight why. Mortgage lending is up 34% and its attractive terms continue to eat into Barclay's dominant 0% balance transfers debt market.
US investors will be waiting to see if the trend in slightly softer economic data coming out of the US is continuing as they digest their manufacturing PMI data. Any growing concern that might be materializing should show up in this afternoon's University of Michigan confidence figures.
The US reporting season takes its foot off the gas a little today as it winds down for the weekend, but we will still hear from the likes of Chevron, AIG and Moody’s with quarterly figures as well as Ford posting monthly sales figures.
Ahead of the open we expect the Dow Jones to start 50 points higher at 17,890