RTTNews - The major markets across Europe are poised for a flat or a slightly positive opening on Thursday morning, as investors await decisions from the ECB and the BOE regarding key interest rates. A Weak closing on Wall Street on profit taking by investors and weak trading across the Asian markets on lower commodity prices should have a negative impact on the markets, although a technical bounce back following sharp losses in Wednesday's session is likely to offer some support.
In the U.S., a report released by Automatic Data Processing Inc., or ADP, revealed that non-farm private employment fell by 532,000 jobs in May following a revised decrease of 545,000 jobs in April. Economists had expected a decrease of about 525,000 jobs compared to the decline of 491,000 jobs originally reported for the previous month.
A separate report from the Institute for Supply Management revealed that its index of activity in the service sector rose to 44.0 in May from 43.7 in April, although a reading below 50 indicates a continued contraction in the sector. Economists had been expecting a somewhat more notable increase to a reading of 45.0.
The Commerce Department, in a separate release, revealed a notable increase in factory orders in the month of April, but the increase came after a substantial decline in the previous month and was slightly below economist estimates.
The Dow closed down 65.63 points or 0.8% at 8,675, the Nasdaq closed down 10.88 points or 0.6% at 1,826, and the S&P 500 fell 12.98 points or 1.4% to 932.
Meanwhile, the European markets ended weaker on Wednesday, led by banking and commodity stocks after weaker-than-expected U.S. economic data dampened investor sentiment about an economic recovery.
The FTSEurofirst 300 index of pan-European blue chips closed 2.01% lower at 868, while the narrower DJ Stoxx 50 index fell 1.97% to 2,133. The U.K.'s FTSE 100 index dropped 2.09% to 4,383, while France's CAC 40 index slipped 2.02% to 3,310 and Germany's DAX index fell 1.74% to 5,055.
On the economic front, the Bank of England and the European Central Bank are set to announce their interest rate decisions. Both central banks are expected to hold their key interest rates at record low levels.
The Monetary Policy Committee of BoE is expected to maintain the Bank Rate at 0.5%, the lowest since the central bank was established in 1694. The decision is due at 7.00am ET. At 7.45am ET, the European Central Bank is expected to announce that it is holding its interest rate unchanged at 1%, following a 25 basis point reduction in May.
Retail sales data for the euro area is due from Eurostat at 5.00 A.M ET. Economists forecast retail sales to grow 0.2% month-on-month in April following a 0.6% fall in March.
automobile stocks might see activity in reaction to a statement from the German Government that a detailed agreement has not yet been reached between General Motors and Fiat SpA represented by Magna International in connection with the sale of GM's Opel Unit and the offer is still open for other bidders as well.
Oil companies might react to the news that the biggest oil company in Italy, Eni SpA has been instructed by the country's energy regulator to give up part of its control on the country's gas stockpiles, citing competitive and energy security in the country as primary reason.
Johnson Matthey plc (JMAT.L) is likely to move in reaction the news that profit attributable for equity share holders for the year ended 31 March 2009 declined from last year despite a marginal rise in total revenues.
Glencar Mining plc (GEX.L) would be in focus after the company said it turned to a profit for full year 2008 compared to a loss in FY07, while operating loss widened from last year.
Helical Bar Plc (HLCL.L) could move after the company reported a wider loss attributable to equity shareholders for year ended 31 March 2009 despite a sharp rise in revenues.
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