It is PMI day in Europe

The dollar is keeping some steadier footing on the day so far as we see risk retreat a little, with the constant barrage of US-China headlines still spewing in.

This also comes as we see US stocks reach a critical point, with the gains from the S&P 500 yesterday pushing it towards a test of its key daily moving averages now:

SPX

So, is this some profit-taking before the next push to try and break those levels? Or is the buzz from US-China tensions started to eat away at investors' optimism?

Looking ahead today, we'll be getting preliminary PMI readings in the euro area. They are expected to show a modest rebound but just take note that there are some caveats when interpreting the headline figure. The details will matter more.

0715 GMT - France May flash manufacturing, services, composite PMI

0730 GMT - Germany May flash manufacturing, services, composite PMI

0800 GMT - Eurozone May flash manufacturing, services, composite PMI

Expectation is for some rebound in activity, with the overall Eurozone composite reading expected at 27.0 after recording a dismal 13.6 last month. Looking at the figure alone, 20+ prints are still horrific and terrible but they would seem to be "twice as good" as last month. However, just take note that this may not be the case since the services index is typically a question of "how is your business activity compared to last month?". So, you can imagine May (less restrictions) being better than April (full-scale restrictions) but that may not underscore the severity of the economic situation.

0830 GMT - UK May flash manufacturing, services, composite PMI

Prior readings can be found here (manufacturing) and here (services). Much like the euro area readings, expectation is for a slightly better bounce in services activity than manufacturing - although both are expected to improve - and that owes to the methodology calculation as noted above in the euro area release details. The market may still react on these headlines today but just be wary that the devil is in the details.

1000 GMT - UK May CBI trends total orders, selling prices

Prior release can be found here. The CBI readings are a survey on manufacturers to rate the level of volume for orders expected during the next 3 months. This should give some idea on sentiment on the ground in the UK economy.

That's all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.