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Service sector PMIs and ADP nonfarms in focus before the FED

The majors

It was a relatively bullish day for the European majors on Tuesday.

The DAX30 gained 0.94%, the CAC40 and EuroStoxx600 ended the day by 0.49% and 0.11%, respectively.

Economic data from the euro zone and the member states supported the positive sentiment regarding corporate earnings.

However, market sentiment on the Fed’s monetary policy pulled the majors back ahead of the monetary policy decision tonight.

The statistics

The manufacturing PMIs for Italy and Spain were the focus at the beginning of the session.

But the final manufacturing PMIs for France, Germany and the Eurozone also caught attention.

Member states

In October, the purchasing managers index for Italy’s manufacturing sector rose from 59.7 to 61.1 compared to a forecast 59.7. Spain’s manufacturing PMI fell from 58.1 to 57.4 from a forecast 58.1.

For France, the purchasing managers’ index for the manufacturing sector fell from 55.0 to 53.6, which corresponds to a preliminary increase of 53.5.

Germany’s manufacturing PMI fell from 58.4 to 57.8, a preliminary decline from 58.2.

The Eurozone

For the euro zone, the manufacturing purchasing managers’ index remained stable at 58.3, down from the preliminary value of 58.5.

According to the October poll

  • Supply-side issues disrupted production schedules and dented order books, slowing growth in both metrics.
  • Supplier delivery times have increased to one of the worst ever recorded.
  • The inflation rates of input and output prices rose to new peaks.

By Member State,

  • The Netherlands are in first place with a 2-month high of 62.5, followed by Ireland (62.1).
  • Italy ranks third with a 4-month high of 61.1, followed by Austria (60.6), which has fallen to an 8-month low.
  • Greece ranked 5th with a 2-month high of 58.9 ahead of Germany, whose PMI fell to a 9-month low of 57.8.
  • Spain and France ranked 7th and 8th with PMIs of 57.4 and 53.6, respectively.

From the USA

There were no major statistics from the US that could give direction to the majors later in the session.

The market movers

For the DAX: It was another mixed day for the auto industry on Tuesday. Continental fell by 1.08% million with Daimler and Volkswagen decreased by 0.35% and 0.34% respectively. BMW bucked the trend but ended the day up 0.20%.

It was a bullish day for banks. Deutsche Bank increased by 0.09%, with Commerzbank increase by 0.77%.

From the CAC, it was a mixed day for the banks. Credit Agricole increased by 0.27% while BNP Paribas and Soc Gen decreased by 0.40% and 0.25% respectively.

But it was also a mixed day for the French auto industry. Stellantis NV increased by 0.46% while Renault decreased 1.12%.

Air France-KLM slipped 0.19% while Airbus SE ended the day up 0.58%.

On the VIX index

The VIX on Tuesday was back in the red.

The VIX reversed a 0.92% increase from Monday, fell 2.32%, and ended the day on 3/16.

The Dow was up 0.39%, with the S&P500 and NASDAQ gaining 0.37% and 0.34%, respectively.

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