Here’s your essential morning update.
– There is a big conference in the US being held at the moment called the Ira Sohn Investing Conference and it was the major talking point and market mover for individual stocks like Moody’s, or the Home Builders ETF on Jeff Grundlach’s comments. You’ll see the feed of stories on our home page.
– The big jump in the ISM non-manufacturing PMI to 55.2 from 54.1 expected and 53.1 last with solid hiring intentions is another strong sign that the first quarter weakness in the US economy was really just weather related. The Markit version of this survey was also higher, at 55 in April.
– So it ended up a positive day, with the data rescuing the market from early weakness after an early weak lead from Europe on enduring Ukraine problems. The Dow closed up 18 points or 0.11% to 16,531, the Nasdaq gained 0.34% to 4,138 and the S&P 500 rose 4 points or 0.21% to 1,885.
– Which adds up to a solid lead for the ASX this morning, with SPI 200 Futures up 12 points to 5,462 bid.
– In Europe, the UK was out for the May Bank Holiday but German shares fell, taking the DAX down 0.27% to 9,530 off its lows thanks to the pick-up in the US. The CAC rose 0.11% while the Spanish index was flat and shares in Milan fell 0.65%.
– In Asia yesterday, the Hang Seng was hit by the weaker-than-expected HSBC PMI, which printed 48.1 from the 48.4 consensus expectation. At the close, the Hang Seng was 1.28% to 21,976. Strangely, given the strength of the yen yesterday which fell to 101.84 in Asian trade, the Nikkei held in fairly well, falling just 0.19% to 14,458. It’s a Tokyo holiday today (Greenery Day) and there is nothing material out of China in the way of data so it should be fairly quiet.
– Forex markets were a bit mixed, with the Aussie recovering from a low of 0.9250 as AUDJPY was pressured lower by USDJPY weakness. It sits around 0.9270 this morning, waiting for the RBA this afternoon. Euro hardly moved and sits at 1.3875 while the pound is also becalmed at 1.6865.
– On Commodity markets, with London and the LME closed, volumes were much lower. Ukraine tensions have lifted Gold almost $30 an ounce over the past two trading days to $1,309.80 this morning. Nymex crude was down 0.38% to $99.38 on the back of the weaker Chinese data but Copper held in, only losing 1 cent to $3.07 lb. On the Ags, the wild ride continues with Corn up 1.87%, Wheat rising 1.91% and Soybeans falling 0.59%.
On the data front today, the Australian trade balance is out with the market is expecting another likely surplus. Then at 2.30pm we get the RBA.
Tonight we see a raft of services PMI’s in Europe before the trade balance in the US.
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