rather than pick out individual stocks to trade, it can often be worthwhile to trade the indices themselves, especially in times of high volatility.

for those so inclined, i attach below charts for FTSE and FTSE 250, though one might equally be tempted to trade Dow or S&P, which is significantly broader in its coverage, or even NASDAQ

for ease of reading, i have attached 1 year and 3 month charts in each instance

Construction PMI 53.2 v 51.8 consensus.

John Lewis sees 'outstanding' Christmas sales

having been prudent yesterday by banking profits in both dow and goog, i have just got brave and re-opened a long dow some 60 points below yesterday's sale

ezone...

LONDON | Tue Jan 3, 2012 4:46pm GMT

LONDON (Reuters) - A mass ratings downgrade of euro zone countries expected early this year is likely to increase selling pressure on French and Italian government debt, but could paradoxically consolidate Germany's safe-haven status.

Standard & Poor's has warned it could soon downgrade the triple-A ratings of Germany, Austria, the Netherlands, Finland, Belgium and Luxembourg by one notch and the ratings of other euro zone countries, including top-rated France but excluding Greece and Cyprus, by two notches.

If they materialise, and analysts say they are largely priced in, the downgrades would reinforce fears the currency union could collapse under the weight of member states' debt. This could inflict severe damage on even the bloc's financial powerhouse and perceived least risky country - Germany.

Its sovereign rating would fall below those of Australia, Canada or Sweden. But those countries' debt markets are much smaller than Germany's and will remain overlooked by investors seeking the safest bonds available.

A more liquid market is considered safer as investors can close an underperforming trading position more easily and limit their losses. At around 2 trillion euros (1.67 trillion pounds), Germany's gross debt is about 14 times that of Sweden in nominal terms.

Any German rating cut would rattle another pillar of the investment world after U.S. debt was downgraded in August.

"If (investors) are only mandated to invest in euros, then they've got nowhere to go. If they're allowed to invest in euros and U.S. dollars, well the amount of triple-A paper would still be zero," said Lyn Graham-Taylor, rate strategist at Rabobank.

"(The UK) is quite a small market and kiwi, Aussie (the New Zealand and Australian dollars) are also quite small so you wouldn't expect a huge reallocation simply because there isn't a large triple-A market left out there."

In face, Graham-Taylor said, German debt could outperform as it would benefit from outflows from elsewhere in the euro zone if France or other states suffered deeper rating cuts.

WIDENING SPREADS

The downgrades would almost certainly lead to a rating cut for the euro zone's EFSF bailout fund, which would hamper hopes it could become a credible institution, along with the European Central Bank, to help Italy and Spain.

The duo, as well as France, which is heavily exposed to them, could then be seen as more vulnerable.

"We possibly could see a bigger impact on peripheral spreads given that the market may question the viability of the EFSF mechanism," said Michael Leister, rate strategist at DZ Bank.

Investors are already bracing themselves for a world of lower-rated governments. French 10-year bonds yield 140 basis points more than German Bunds, compared with 40 bps six months ago and part of the widening was fuelled by expectations France will lose its triple-A status.

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Graphic of triple-A euro zone govt bond spreads: link.reuters.com/xaw94s

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Despite the downgrades being widely anticipated, analysts say the spread widening trend in France and elsewhere has further to go in the absence of a solution to the debt crisis.

"Already quite a few investors in our client base have reduced exposure to a country like France. We already have a cautious stance on France ... It would not have an impact on our positioning," said Kommer von Trigt, a bond fund manager with Robeco Group, which manages about 140 billion euros.

But while it would not affect Robeco's funds, which are allowed do invest in any country, some of the group's clients may be forced to cancel their exposure to French debt because their investment rules mean they may only invest in triple-A debt, he added.

"It's very clear at least to us that French yields will continue to trade much higher versus Germany than two years ago," von Trigt said.

If Germany is downgraded as well, the triple-A benchmark will lose its significance, he said.

(Graphic by Vincent Flasseur, additional reporting by William James, editing by Nigel Stephenson)

The graphic from the above post.

Non Farm Payroll 325K consensus 176k

Skinny

So is that around 150000 more in work or out of work?

Yes :-)

From the link :- Estimated change in the number of employed people during the previous month, excluding the farming industry and government;

Looks good for a DOW rise then.. I think

Skinners,

I think you mean ADP, not NFP.

ADP and Jobless Claims today. NFP tomorrow. Caution on the ADP numbers also. They're unreliable at this time of year to say the least.

Btw, are you 99?

High Hils - yes - I did put both links up on the traders thread earlier - clear as mud !

On edit - the definition of today's figures "Estimated change in the number of employed people during the previous month, excluding the farming industry and government"

And of Tomorrow's "Change in the number of employed people during the previous month, excluding the farming industry"

I was referring to this post, Skinners:

skinny - 05 Jan 2012 13:17 - 7696 of 7701
Non Farm Payroll 325K consensus 176k

That's today's ADP number you've quoted.

Yes sorry, the full description is "ADP Non-Farm Employment Change". (ADP - Automatic Data Processing).

Oooooooh........red ink!!! Are you in trouble now skinny???!!! ;o)

Nah - blue does red :-)

Life was simpler when we had The Forex Thread

Today

ADP Employment Change Actual 325k vs Consensus 165k

The Employment Change released by the Automatic Data Processing, Inc is a measure of the change in the number of employed people in the US Generally speaking, a rise in this indicator has positive implications for consumer spending which stimulates economic growth. Generally speaking, a high reading is seen as positive, or bullish for the USD, while a low reading is seen as negative, or bearish.

Continuing Jobless Claims Actual 3.6m vs 3.522m Consensus

The Counting Jobless Claims released by the US Department of Labor measure the number of individuals who are unemployed and are currently receiving unemployment benefits. It presents the strength in the labor market. A rise in this indicator has negative implications for consumer spending which discourage economic growth. Generally speaking, a high reading is seen as negative, or bearish for the USD, while a low reading is seen as positive, or bullish.

Initial Jobless Claims Actual 372k vs Consensus 375k

The Initial Jobless Claims released by the US Department of Labor is a measure of the number of people filing first-time claims for state unemployment insurance. In other words, it provides a measure of strength in the labor market. A larger than expected number indicates weakness in this market which influences the strength and direction of the US economy. Generally speaking, a decreasing number should be taken as positive or bullish for the USD.

Tomorrow

Nonfarm Payrolls consensus 150k

The nonfarm payrolls released by the US Department of Labor presents the number of people on the payrolls of all non-agricultural businesses. The monthly changes in payrolls can be excessively volatile. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish).

Oh well - the description here is incorrect then.

hic!

Who's the Muppet now then? -):