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Ahead of Memorial Day Weekend the biggest market moving events for the markets are expected to come out of Europe.Sherry Cooper, chief economist at BMO gives us the biggest macro data points that investors need to watch for.
- The political upheaval in Europe with parties shifting to the left and the question of a Greek exit from the eurozone.
- The EU leaders’ meeting in Brussels on Wednesday in which French president Francois Hollande will present his growth proposals and push for Eurobonds.
- May readings for the eurozone manufacturing and services PMIs are expected on Thursday. Both measures declined in April showing a second consecutive drop, and another decline would suggest that the downturn in Europe is deepening.
- German business confidence is out on Thursday and the Ifo survey for May is expected to slip modestly, but showing that exports, domestic demand and record-low borrowing costs are keeping businesses confident for now.
- UK’s April CPI was up 0.6 per cent month-over-month and back in the target ranger for the first time since 2010. This will leave the Bank of England with more scope for more QE. “That is something that happened to come up in the IMF’s regular article on the British economy, which noted that ‘Fiscal easing and further use of the government’s balance sheet should be considered if downside risks materialise and the recovery fails to take off’.”
- British retail sales for April will be released on Wednesday.
- China’s HSBC Flash PMI for May will be out on Thursday and is expected to be contractionary for the seventh straight month. Investors will however be watching to see if the contraction worsened or improved.
- There are also expectations for more growth boosting efforts out of China after Premiere Wen’ statements over the weekend, and with some headlines about Samsung China expecting demand to slow, and the FT report about consumers of raw materials holding off paying their contracts and some outright defaulting on them.
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