📆 Wednesday, December 6
► European stocks edged higher, following a positive Asian session, buoyed by yesterday weaker-than-expected US labor market data suggesting a global shift towards easing monetary policies by central banks next year. The Stoxx 600 rose 0.2%, continuing its upward trajectory. German factory orders experienced a significant decline from 0.7% to -3.7%, underscoring the challenges in the Eurozone’s largest economy. In addition to this, we see mixed Eurozone construction PMI, seeing slight increases in France, Italy, and the rest of the Eurozone, while there was a slight decrease in current problem child Germany. The ECB indicated a significant slowdown in inflation, prompting investors to anticipate rate cuts ahead of other major central banks.
► In the US, equity futures also rose slightly, with the S&P 500 increasing by ~0.2%. Yesterday's labor market data showed a cooling of the labor market, which was reflected in a decline in job openings. This is leading to speculation that the Federal Reserve will cut interest rates to prevent a recession. Yields on 10-year government bonds stabilized below 4.2%. The USD weakened against the major currencies, suggesting a more cautious market outlook. The focus will remain on labor market data – today the ADP employment change will be released – often unreliable data, but which could already change expectations for Friday's NFP data.
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