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FTSE and pound both fall as UK services PMI beats expectations but slips month-on-month

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In a slight bucking of the recent trend the UK’s September services PMI managed to best analysts’ estimates, coming in at 52.6 to the 52.1 expected, but below August’s 52.9. That marks a difference from the manufacturing and construction surveys earlier in the week, both of which not only surpassed expectations but beat the previous month’s readings by quite a bit. That perhaps explains why the news failed to temper the FTSE’s fall this morning, the UK index dropping by 85 points to dip under the 7050 mark. The pound, meanwhile, also struggled to find much joy in that services reading, with sterling slipping by 0.1% against the dollar and 0.3% against the euro.

Wednesday’s situation was similar over in the Eurozone. Both the DAX and CAC fell by 0.8% this morning thanks to the news that the region’s private sector growth slumped to a 20 month low across September.

Looking ahead to the US open and after a late fall yesterday evening the Dow Jones appears to have caught an early case of the pre-non-farm jitters. The futures are suggesting the Dow doesn’t want to budge from 18160, at least until it gets a glimpse at the latest ADP non-farm and trade balance data. After the bell the markets then get the latest assessments of the US services sector, with the Markit and ISM readings expected at 51.9 and 53.1 respectively.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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