Daily Market Review 1 of November
The Markets searched for direction yesterday after mix data out of Europe and after two days shut down in the US following super storm Sandy.

In a press conference yesterday, Spain’s prime minister said that an agreement on direct bank recapitalization is getting closer and that such an agreement would improve market confidence. This step is moving Spain one step further into the expected bailout.

Even though sentiment lifted after Spain PM comments, it was soon diminish after official report showed that Euro zone unemployment rate climbed to a record 11.6% in September, from an upwardly revised 11.5% in August.

Unfortunately for Greece, In a Euro-zone finance minister’s meeting yesterday it was said that there's no guarantee Greece will be given its next round of aid in a couple weeks, according to media reports. Ministers held a conference call to discuss possibly giving Greece extra room to meet deficit targets that are part of its bailout agreement.

Early in the morning today, positive data out of the world’s second largest economy, China, surprised the markets. Official data showed that China’s manufacturing purchasing managers’ index came in at 50.2 in October, up from 49.8 in September, just slightly below forecasts for a reading of 50.3.

A separate report showed that the final reading of China’s HSBC PMI came in at 49.5 in September, an eight month high.

Later in the day, the U.S. is to release the ADP report on nonfarm payrolls, as well as the weekly government report on initial jobless claims. In addition, the Institute of Supply Management was to publish data on U.S. manufacturing activity (ISM manufacturing activity).

On Friday, the U.S. will release its closely-watched report on U.S. non-farm payrolls that will shade some light on the strength of the U.S. labor market.

Any improvement in the U.S. economy could scale back expectations for further easing from the Federal Reserve, boosting the dollar and potentially weighing on Gold.

EUR/USD The euro was lower against the U.S. dollar on Today, as ongoing uncertainty over Spain and Greece weighed but, losses were limited following the release of encouraging Chinese manufacturing data.

The Euro is likely to consolidate around these rates waits for the important NFP data to be release on Friday before the bell.

Support: 1.2927, 1.2888, 1.2820
Resistance: 1.2989, 1.3023, 1.3079

Overall sentiment: Hold