By Greg Peel

The Dow closed up 33 points or 0.3% while the S&P gained 0.1% to 1320 and the Nasdaq lost 0.4%.

We've come to treat the HSBC flash estimate of China's monthly manufacturing PMI as an important global economic indicator, with yesterday's result showing a fall to 48.7 in May from 49.3 in April. The result is not encouraging in the face of heightened euro-fear, but is largely neutralised by the expectations of further policy easing from Beijing.

The Chinese survey is compiled for HSBC by financial services company Markit, and Markit has also for some time been providing an equivalent estimate for Europe. The final PMI, announced at the beginning of the following month, represents a completed survey of relevant purchasing managers, while the flash number is released a week earlier once some 85% to 90% of survey results are in.

Last night Markit released, for the first time, a flash estimate of the US manufacturing PMI. The May result suggests an easing of expansion to 53.9 from 56.0 in April. The PMI number was accompanied last night by the monthly new durable goods orders release, which showed a rise of 0.2% in April following a shock 3.7% fall in March, when economists had expected a 0.4% April fall. However, removing the lumpy transport subset (aircraft etc) left a fall of 0.6% ? the fourth fall in succession.

The estimate of the eurozone's composite PMI, combining manufacturing and services, suggests a fall to 45.9 in May from 46.7 in April to mark the lowest read since June 2009. Germany's IFO survey of business confidence has posted the sharpest drop this month since last August. Last night's first revision of the UK March quarter GDP lowered the result to negative 0.3% from the initial negative 0.2%.

Not a pretty global picture. But then we can't be too surprised given the down-draught being created by Europe, Beijing's efforts to cobble China's property market, and America's uncertainty over whether or not the Fed will roll out QE3. What we do know, however, is that the shift to growth over austerity in Europe implies greater stimulus from the ECB, that Beijing is intent on providing stimulus for China's domestic economy, and that the Fed will indeed roll out QE3 if a weakening of circumstances dictates.

Let slip the printers of war.

In the meantime, the European debate seems now to have shifted from will/won't Greece leave the eurozone to whether the assumed exit will be orderly/disorderly. We'll be able to talk about this one for almost a whole month ahead of the Greek election. Great! We can no doubt safely assume, nevertheless, that the "orderly" plans will be in place ahead of the result rather than after, if "orderly" can actually be achieved before Greece's banks are drained.

Wall Street's had enough of it. After a couple of weeks of euro-mess, Jamie Dimon losing his super powers and the farce that has been Faceplant, Wall Street is keen for a holiday. There's still another session before the long weekend, but if last night's action is any guide, there'll be about four people on the NYSE floor tonight. Last night US stock indices wobbled around the flat line doing a lot of very little.

The euro took a bit of a breather last night too, which helped to calm markets, despite the weak European data. The US dollar index finished up 0.3% to 82.34, with both currencies supported by rumours the Swiss government is planning a deposits tax. Probably time to take all that money out of your secret Swiss bank account. I know I will be.

Commodities had a chance to stabilise, with gold down only slightly to US$1559.00/oz and base metals all a bit stronger. Talks with Iran regarding its nuclear program concluded last night with no result other than a reschedule for June, helping Brent rise US49c to US$106.55/bbl and West Texas US$1.10 to US$91.00/oz. The Aussie is steady at US$0.9762.

The US ten-year bond yield is sitting at 1.76% and the VIX at 21.

The SPI Overnight was up 16 points or 0.4%.

Well look I'd love to stay and chat but I, too, am a bit over euro-fear limbo for the time being so I'm going to take a short break after today. My esteemed editor is returning from his overseas assignment as we speak and he will be bringing you the Overnight Report for the next couple of weeks. I will then return somewhat of a milestone older, but probably not any wiser.

Don't go doing anything silly while I'm away.

Cheers.

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