Intraday Market Thoughts

UK Manufacturing PMI Weakens; ISM Manufacturing Next

by Patrik Urban
Oct 1, 2012 12:11

Euro stabilizes around 1.29 after post-Stress Test slide to 1.2804. European PMIs revised higher; Chinese manufacturing sector contracts; UK manufacturing PMI lower. Market turns to ISM manufacturing and Bernanke's speech. See the latest on Premium Insights below. A new edition will be posted today.

The greenback is weaker in the ongoing session but it is off its lows. European equities are gaining about 1% and the relative strength winner is

EUR while JPY lags.

Rallying equities along with a slew of manufacturing data helped the common currency to rise to 1.2910 level. The final readings of September manufacturing PMIs from France, Germany and Eurozone all showed slight revisions higher but remain stuck deeply in the contraction zone. EURUSD trades around 1.2895.

Even AUDUSD is higher despite Chinese manufacturing PMI that contracted for the second month in a row as it printed 49.8 in September from August's 49.2.

UK manufacturing PMI weakened further in September to 48.4 from 49.6 which is the 5th sub 50 level reading. Production, new export orders and employment all declined while cost pressures rose sharply giving worrying signs about the months ahead. GBPUSD rose to 1.6164 but it lost a part of its gains and trades around 1.6145 while EURGBP rose to 0.7990.

Other news showed that Swiss retail sales rose sharply in August by 5.9% from previous 2.9% but SVME PMI dropped to 43.6 from 46.7. Eurozone unemployment rate remained steady at 11.4%.

The US session begins at 8:30 am ET with Canadian RMPI that is expected to rise 1.4% in August from previous 0.9%. ISM manufacturing that is due at 10:00 am is seen at 49.8 in September from 49.6 in August.

Focus will also be on the FED chairman Bernanke that delivers a speech on monetary policy at 12:30 pm at the Economic club of Indiana. Q&A session will follow. Moody's did not change Spanish rating on Friday but the possibility of a rating cut persists.

GBPUSD is added to 1 EURJPY and gold as the trades stopped out. 1 AUDUSD and 1 silver hit all targets. Both EURUSD, 1 silver,1 EURJPY, 1 CADJPY are in progress. Direct access to trades, charts and rationale can be found directly in here: Non subscribers can join here:


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