Last night’s positive finish on Wall Street could well have translated into a much higher European open this morning were it not for the disappointing Chinese HSBC manufacturing PMI data earlier this morning, coming in below expectations at 50.5. Despite the resilience of stock markets generally in the US and Europe concerns remain about the continued stream of disappointing economic data. The latest manufacturing and services April PMI data from France, Germany and the wider euro area are expected to show marginal improvements from the figures released two weeks ago, however concerns remain with respect to the French economy which posted particular weak numbers and appears to be spiralling downhill extremely rapidly along with President Hollande’s poll ratings. Expectations for French manufacturing PMI are for a slight improvement from 44 to 44.1, while services are expected to improve to 42 from 41.3, its lowest level since February 2009. The German economy remains the main outlier but even here expansion remains difficult with manufacturing expected to stay at 49, still in contraction territory, while the services sector is expected to inch higher to 51 from 50.9. These small adjustments are expected to nudge the broader European measure slightly higher for the services sector to 46.5 with the manufacturing sector unchanged at 46.8. In Italy the political deadlock is likely to see April consumer confidence slip further to 85 from 85.2, even though we could well see some progress on the politics in the coming days after the newly re-elected Italian President took the opportunity to lambast the country’s bickering politicians over the current deadlock and threatening to resign if they didn’t start making some progress. In the wake of last week’s downgrade of the UK credit rating by Fitch the UK economy has become a bit of a battleground for the debt versus austerity debate currently being played out across the world. Last week’s criticism of the UK by the IMF’s chief economist Olivier Blanchard was quite a significant change of tone from the fund’s previous missives and stems largely from the furore surrounding the economic paper of Rogoff and Reinhart. The UK Chancellor is now in the middle of this particular debate with the ratings agencies on the hand saying that the UK lacks the fiscal space to absorb further economic shocks, while on the other hand we have the IMF saying the UK was one of “a few countries where we think there is enough fiscal space to go further.” This rather brings us neatly onto this morning’s March public finance numbers which are expected to a deficit of £14.3bn, up from February’s £4.4bn, which is expected to take annual borrowing to a figure only slightly better than last year’s number of total figure of £121bn and well above the Chancellor’s original estimate 12 months ago. This does seem to suggest that the Chancellor has in fact eased up on cuts to public spending in the face of the problems in Europe, and along with fears about slower growth this slow down in both deficit reduction and growth was one of the reasons cited for the ratings reductions, by both Fitch and Moody’s a few weeks ago. When faced with these sorts of contrasting views it really isn’t too much of a surprise that both the ratings agencies and the IMF appear to have lost credibility as a result of this financial crisis. As things stand only one ratings agency now has the UK on a triple “A” rating, that being Standard and Poor’s and this rating only remained intact on the basis of the current fiscal plan, so the Chancellor is highly unlikely to alter his plans whatever the IMF say or don’t say, when they come for their financial review in the coming weeks. ARM Holdings will report Q1 earnings to the market today, with analysts expecting an increase of up to 30% in like for like profits. Although the last couple of months have seen a slight pullback, the last year has seen the stock up a whopping 88%, with revenue’s on the up for three quarters straight. 60% of analysts currently hold buy ratings on the firm. 888 Holdings will release an interim management statement today. Early indications for the year have been bright, with revenues reported up 8% year on year up to the 9th of March. Any more news on its US ventures will be of keen interest to investors, after 888 recently became the first firm since 2006 to win an online poker license in the US. The move from the Nevada gaming commission will hopefully pave the way for more licenses stateside. Primark owner Associated British Foods will also report half-year earnings today. The squeezing of UK disposable incomes has given a welcome lift to winter sales, as consumers increasingly turn to bargain hunting at the low cost retailer. Total sales were up 23% for the 6 months up to March and analysts at Hargreaves Landsdown expect pre-tax profits to come in 20% higher at £438m. Staying with retail, investors will find out how a freezing March has affected the recent turnaround in sales at Carpetright, who report Q4 figures today. Over in the US, today’s earnings releases from US airways and Delta airways, amongst others, will act as wingmen to the star of the show, Apple. The tech giant’s stint as the biggest global company by market cap seems to have been the kiss of death, with the stock now offered over 40% lower than its September 2012 highs, as it loses grip on the smart phone market to rivals and investors question their ability to keep up with historical growth levels. The one thing in its favour will possibly be that expectations are so low for a change, and with the stock having sold off to the extent that it has, many may be eager to jump back on the band wagon sooner rather than later. 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.