Even though we saw tiny improvements in economic data from Europe’s services sector yesterday, the data still pointed to significant weakness in the economy, and as such there was little appetite to push stocks much higher in the absence of the London market, though US markets continued where they left off on Friday, with the S&P500 again closing at a new record high. The surprise improvements in the US labour market with subsequent positive revisions to February and March’s jobs data has seen new record highs for both major US benchmarks as well as a record closing high for the German DAX, with the July 2007 intraday high at 8,151 almost within touching distance. With US markets continuing to outperform, coinciding with yesterday’s reiteration by ECB President Mario Draghi’s of the prospect of negative rates underpinning risk appetite, we can expect to see a mixed European open this morning as investors focus on the US economic recovery to the exclusion of the problems of Europe, which show little likelihood of improving any time in the short to medium term. This is likely to be borne out by continued negative numbers for French industrial and manufacturing production for March which is expected to show declines of 0.3% and 0.5% month on month respectively. Until recently Germany had shown itself to be largely immune from the woes of the European economy, however recent data has shown that even here the chill winds are starting to blow ever more strongly. Today’s economic data from Germany is likely to show that factory orders for March declined 2.9% year on year, a sharp fall from February’s 0% reading. The month on month figures is not expected to be much better either with a fall of 0.4% expected, down from a 2.3% rise in February. In Australia the Reserve Bank of Australia unexpectedly cut rates by 0.25% to 2.75% surprising many market commentators who had expected no change in rates. The RBA does have form in this department and given some of the recent economic data it can’t really have come as too much of a surprise. The cut also needs to be set in the context of looser monetary policy elsewhere in the world with the RBA cognisant of the risks of a higher currency having negative effects on the Australian economy which is showing some signs of a slowdown in economic activity. In this context and having seen the ECB and the Federal Reserve signal the likelihood of looser policy last week today’s rate cut makes perfect sense. The latest trading update from the banking sector continues with the UK’s biggest bank HSBC reports Q1 results, having embarked on significant cost cutting investors will be looking to see whether recent job cuts have improved margins as the bank struggles with wafer thin margins. We also can expect to see updates from Societe Generale, Credit Agricole and Commerzbank. Following much press speculation, Sainsburys has confirmed it is in advanced talks with Lloyds Banking group to take full ownership of Sainsbury’s bank in a deal which will most likely run into the hundreds of millions of pounds. In a similar deal in 2008 Tesco paid RBS £950m for full control on Tesco Bank. We expect to get further clarification on the possible deal when Sainsburys reports to the market on Wednesday but may see price movement in anticipation today. IT company Telecity Group were buoyed last week as Deutsche Bank reaffirmed their buy rating on the stock and will be hoping for continued good news from today’s interim management statement. Concerns held by shareholders regarding delayed projects were put to rest when they last updated the market in February with a generally positive tone relayed for the forthcoming year. It will also be interesting to what decision have been made about continuing what was a maiden dividend payment last year. It has reported that Betfair will come out fighting when they publish a trading update today with Sunday papers claiming they may pay a one off bumper dividend in an attempt to appease unhappy investors after three years of poor share price performance especially in light of all the attention they have received from CVC who have until May the 13th to table a formal bid after already have a bid rejected. Investors in National Express will be hoping for better news after Februarys update highlighted how badly affected they were by the British Governments removal of a coach concessionary scheme. They estimate they lost over 1million disabled and elderly passengers leading to a reduction ion profit of £180.2 million. We should hear further news about any developments in their attempts to apply for licences to run coach services in Germany. CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.