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Analysts at Danske Bank suggest that even though significant market attention will be on the new government in  Italy  that was formed last night and what policy signals it will send with regard to its economic and EU policy programme, but UK manufacturing PMI and US NFP will also gauge some market attention in today’s session.

Key Quotes

“In the  UK, we also get the PMI manufacturing index for May. The UK index is more volatile (bigger swings) than the equivalent index for the euro area, and since it fell in May, the UK index may very well follow. We estimate a fall to 53.6 from 53.9.”

 “The  market will also focus on  trade  tensions  between  the US and EU countries, Canada and Mexico.”

“On the data front,  the most important release of the day is the US jobs report for May. Once again, average hourly earnings  is the key number to watch. We estimate wages rose +0.2% m/m in May, in line with the recent trend, implying an unchanged annual growth rate of 2.6% y/y. We estimate that nonfarm payrolls rose 190,000 and the unemployment rate was unchanged at 3.9%.”

“Based on the regional PMIs and Markit PMI manufacturing,  US  ISM manufacturing probably rose and we think it may have rebounded from 57.3 to 58.0. This does not change our overall view that the US manufacturing indices should move lower in 3-6M.”