Market Update - 6 November 2012

• The yoyo trading in equities overnight was unsurprising given the busy calendar for the rest of the week. European stocks fell (Eurostoxx -1.16%), playing catch up with the late selloff in the US on Friday, with Spain (-1.89%) underperforming after the number of registered unemployed rose 128.2k vs the survey of 110k with the total number of jobless rising 2.7% to 4.8m.

• The Dow will close marginally higher, as will the S&P as banks look soft but tech, oil & gas stocks outperformed.

• USDMYR opened where it closed yesterday at 3.0630 as market keenly awaits the result of the presidential election, Asia time will know the results when we wake up tmrw. Expect low trading volumes and maybe some slight upside for today as we await the elections but I reckon regardless who wins, market should be risk on slightly tomorrow as the uncertainty lingering for past month is finally over.

• Interesting enough, on Bloomberg TV yesterdat they interviewed Paddy Power one of the largest online betting firms and they have already paid out for the people who placed their bets on Obama to win, and that percentage of betters who bet on Obama to win was 75%. These guys are usually quite sharp for some reason, let’s see if they made the right decision to pay out early this round.

• Peripheral spreads widened again as safe havens were sought, treasury yields fell 3bps to 1.686% and German 2yr yield turned negative for the first time in 2 months.

• Gold also bounced 0.34% or $6 to $1684, while WTI oil stepped back from the precipice, rising 86c to $85.72.

• The ISM released its Non-Manufacturing PMI in the States, the number was 54.2 vs 55.1 last and 54.5 on the survey. The number, despite falling is showing a mild uptrend with construction and retail the best performing sectors; the employment index also showed a large rise to 54.9 from 51.1 last month.

• In the UK the services PMI fell to 50.6 from 52.2, a level last seen in late 2010 and at the bottom of the post GFC range. This flies in the face of the recently positive data there; the pound fell 46pts through 1.60 to close 1.5969.

• Something I thought I’d just point out here from Ambrose Evans Pritchard from the UK’s Telegraph re China from the weekend, it’s big picture stuff but a great read on the situation in China ahead of Thursday’s Party Congress: http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9654300/Chinas-economic-destiny-in-doubt-after-leadership-shock.html