Sentiment was under a "risk off" mode as PMI data from both China and the Eurozone was disappointing. Some noises came from the Eurozone regarding Spain's request of financial assistance and the progress of fiscal consolidation in Greece. Yet, both issues failed to excite the financial markets. Wall Street opened lower but slowly recovered with the DJIA gaining +0.14% and the S&P slipping -0.05% respectively. In the commodity sector, the front-month contract for WTI crude oil rebounded after a 3-day selloff, adding +0.48%, while the Brent crude contract added +1.70% during the day. Gains were drive by the news that a Venezuelan refinery was on fire.

A Financial Times report stated that that the EU has been in talks with the Spanish government over a possible rescue package. According to the report, the talks between 2 parties "are focusing on measures that would be demanded by international lenders as part of a new rescue program, ensuring they are in place before a bailout is formally requested". Yet, this was later denied by officials who said that the discussions were focused on structural reforms in the Spanish economy, not about austerity measures.

In Greece, it's expected that the debt-ridden country would secure another tranche of assistance. However, while Prime Minister Samaras has made some progress in reaching agreement on budget cuts with the Troika, it has yet to overcome challenges from his coalition partners. Democratic Left leader Fotis Kouvelis said that "the troika must understand there are limits" to implement fiscal consolidation. Meanwhile one of the party's MPs said he was setting up a movement to oppose implementation of austerity measures. Greece is not alone in facing severe opposition as adopting austerity measures means welfare would be diminished. In Portugal, popularity of the Portuguese Government slumped 12% to a record low after it lifted taxes.

On the dataflow, US' initial jobless claims fell -3K to 382K in the week ended September 15, compared with market expectations of a drop to 370K. The 4-week moving average increased +2K to 378k. Continuing claims slipped -32K to 3272K after falling -28K in the prior week. The Philly Fed manufacturing index improved to -1.9 in September from -7.1 a month ago. The market had anticipated a milder improvement to -3.3. Today, the focus will be on Canada's inflation which probably gained +1.3% y/y again in August. Core CPI might have eased to +1.6% from +1.7% in July.