London carries on

Yesterday’s markets

6th June 2017

  • GBP - Services PMI: 53.8
  • USD - ISM Non-Manufacturing PMI: 56.9
  • USD - Factory Orders m/m: -0.2%

The Metropolitan Police came under scrutiny yesterday, as it was discovered one of the attackers from Saturday night was known to the police and MI5. Two members of the public expressed their concerns to the police that Khuram Butt was trying to radicalise children. Butt also appeared in a Channel 4 documentary about Islamist extremists last years with links to jailed preacher Anjem Choudary. The other two attackers were not known to the police. With the election campaigning now resumed, Labour has accused Theresa May of cutting the Home Office’s policing budget making it harder to keep the public safe. Foreign secretary Boris Johnson has responded to the accusation saying ‘all that argument detracts from the responsibility of those scumbags and what they have done.’

The UK services PMI posted lower than expected yesterday at 53.8, the weakest pace since February. The report on the service sector found the reason behind the bearish data could be a result of tighter household budgets. It is thought that some of the respondents have been delaying their decision making until after the General Election. Across the pond, the ISM non-manufacturing PMI was released as expected, at 56.9, showing the sector is continuing to grow. The respondents showed optimism about the business conditions and overall economy.

In the Middle East, several Arab countries, including Saudi Arabia and Egypt, announced they were cutting their diplomatic ties with Qatar. They stated the reasons behind the cut is Qatar’s funding of militant groups including the Islamic State and al-Qaeda. However, Qatar denies the claims. All Qatari visitors and residents in the UAE and Bahrain have been given two weeks to leave the country whilst some of the Arab countries have banned their residents from traveling to Qatar. The UAE and Egypt have given the Qatari diplomats 48 hours in which to leave the country. As Qatar is an oil-rich country, the price of oil depreciated substantially yesterday.

Today’s markets

5th June 2017

  • AUD - RBA Rate Statement
  • AUD - GDP q/q
  • USD - JOLTS Job Openings

The Eurozone release two key pieces of tertiary sector data this morning. Retail sales and retail PMI are both scheduled to decline from the previous reading as the single currency union continues to struggle. Across the pond, the US release another key piece of labour data after Friday’s non-farm payroll and unemployment rate. The JOLTS job openings are forecast to drop slightly to 5.65m.