Bumpy ride likely because of EU debt and Korea

INVESTORS are likely to be in for another bumpy ride this week, as the European sovereign debt crisis and military aggression from North Korea look set to continue.

For today’s open, GFT is expecting the FTSE 100 index to open 11 points off from Friday’s close, at 5658. The German DAX 30 is expected to open 12 points lower, at 6837 and the French CAC 40 seven points lower at 3722.

The economic diary for the week ahead includes money supply figures and PMI surveys, out of the UK. From the Eurozone there are updates on consumer sentiment, unemployment, PPI and retail sales. The European Central Bank is due to meet on Thursday. Of particular interest will be any comments by Jean-Claude Trichet on a reduction in the amount or duration of emergency funding for struggling European banks.

The market will look for continued improvement in the US economic outlook, where there will be a chance to gauge the outcome of early holiday shopping, as well as figures for real earnings, consumer confidence, auto sales and monthly chain store sales.

Towards the end of the week attention will turn to Friday’s US employment report. Consensus is for an increase of 138,000 to non-farm payrolls, with the unemployment rate remaining at 9.6 per cent. The market will be looking for early clues on this number from the ADP Employment report due for release on Wednesday.

Mark Outten is a senior dealer for GFT Global Markets UK Ltd