Good morning! Here are 10 major stories in markets today.
European PMIs are coming. The first round of May business surveys for European firms comes out between 8 a.m. and 9 a.m. London time (3 a.m. and 4 a.m. New York time). Economists expect a very slight drop in reported output from its May levels, and the figure should be a good signal of the European recovery’s strength.
George Osborne told the UK’s top business lobby his main challenge is boosting productivity. According to the Financial Times, at the Confederation of British Industry (CBI) annual dinner, Osborne said he would release a “plan to make Britain work better” with ideas on productivity, ahead of his July budget.
The Federal Reserve seems pretty unlikely to raise interest rates in June. The Federal Reserve released the Minutes from its April 28-29 Federal Open Market Committee meeting Wednesday night, which indicated that the Fed is unlikely to raise interest rates in June due to the recent rash of less positive economic data.
Greece’s creditors are reportedly making pension reform their top priority. According to Bloomberg, Greece’s European creditors and the IMF are concentrating on getting concessions on the country’s generous pension system, “leaving the door open to compromises on other issues like the country’s minimum wage proposals,” in negotiations ahead of an IMF payment Greece probably can’t make (without a bailout) on June 5.
There may be a problem with the way the US measures GDP. In a statement to CNBC, the Bureau of Economic Analysis said it is “aware of issues” that the way it tabulates gross domestic product and that it is “developing methods to address what it has found.” In the first quarter, the first estimate of GDP showed the economy grew just 0.2% to start the year, well below what Wall Street economists had forecast.
UK retail sales are coming too. April’s numbers are out at 9:30 a.m. London time (4:30 a.m. New York). Economists are expecting a 0.4% boost from March to leave sales up 3.8% from the same month last year. It’s the first retail sales number after Q1, when GDP came in at a disappointing +0.3%.
China’s manufacturing PMI missed expectations. The preliminary reading of the HSBC-Markit manufacturing PMI gauge increased to 49.1 in May, higher than the 48.9 level of April, but yet again below forecasts for an increase to 49.3. Anything below 50 signals contraction.
Asian markets are mixed. The Hang Seng is having another down day, 0.26% lower than Wednesday’s close, Japan’s Nikkei is basically flat, up 0.02%, and the Shanghai Composite is up 1.14%.
Ukraine says it is fighting a “real war” with Russia. Ukrainian President Petro Poroshenko sparked fresh Kremlin fury by warning that his crisis-torn country was fighting a “real war” against Russian aggressors that could escalate at any time.
China’s premier says the country is confident of its new growth target. Premier Li Keqiang said he was confident China has the ability to meet its 2015 economic growth target of around 7%, the official news agency Xinhua said on Thursday.