By Greg Peel

The Dow closed up 11 points or 0.1%, while the S&P fell 0.1% to 1403 and the Nasdaq lost 0.2%.

It was safe to assume not much would happen last night, and it didn't. Wall Street bounced around all day, but went nowhere in the end. The only real news of note was a guidance downgrade for the September quarter from global economic bellwether FedEx, which warned of falling deliveries.

The interminable waiting game between the last ECB meeting a month ago and tomorrow night's gathering has allowed the world's imagination to run wild, such that every little rumour or Chinese whisper morphs into front page news. Whether or not any such media speculation proves true we will find out tonight, but last night saw one last ditch effort, this time from Bloomberg.

There has been much talk of the ECB buying "unlimited" amounts of distressed sovereign bonds in order to "cap" the borrowing rates of Spain and Italy. Leaving aside for a moment the fact the ECB can't do anything until a bail-out is requested (Spain is yet to do so and Italy says it won't), and the fact the ECB will buy bonds in the secondary market only if the ESM buys bonds in the primary market (the ESM's legality won't be ruled upon until next week), Bloomberg suggested last night the ECB will indeed make unlimited bond purchases, but will sterilise them.

Sterilisation implies an offsetting sale of assets to any purchase of assets such that the central bank balance sheet is unchanged. The Fed's Operation Twist is an example of sterilsation, given the purchase of longer dated bonds is offset by the sale of shorter dated bonds. This differs to QE1 and QE2 which saw the Fed simply buying longer dated bonds outright.

While everyone is sceptical of the newsflow at present, sterilisation is not seen as a bad thing for the ECB. It's not, however, seen as a good thing either as it doesn't represent the "big bazooka" and would thus prove a disappointment. Bloomberg was unable to suggest just how the ECB might sterilise its bond purchases. Draghi has hinted he can buy shorter dates, but he would definitely not sell longer Spanish and Italian bonds in return. Suggestions have been that he could sell German bonds or even US bond holdings as the offset.

But once again, if we just wait till tomorrow we'll know.

Service sector data has otherwise provided the flavour of the last 24 hours and what another tale of woe we've seen, following on from the miserable set of manufacturing numbers. The worst result of all came from Australia, where the services PMI plunged to 42.4 in August from 46.5 in July. Service sector strength once offset manufacturing sector doldrums in this country post-GFC, but the August result represents the seventh consecutive month of contraction and a pretty rapid pace of contraction it has now reached.

Never mind, apparently our economy is a shining beacon according to the Treasurer (but not to Ms Rhinehart), posting 3.7% growth in FY12. The September quarter numbers should be interesting.

On Monday, Beijing announced China's services PMI had risen to 56.3 from 55.6, but last night the independent HSBC survey declared a fall to 52.0 from 53.1 to its lowest level in 2012. The eurozone also marked a seven month run of contraction, as its PMI fell to 46.3 from 46.5, while once again the star was the UK, which saw an increase to 53.7 from 51.0. Monday's manufacturing PMI release from the UK also showed healthy improvement, albeit not quite back to the neutral (50) mark. Shows what you can achieve when you're not in the euro.

For some reason the LME got all excited about the latest ECB rumour last night, sending base metal prices all up around 1%. Other markets largely shrugged, with gold slipping US$2.80 to US$1693.10/oz as the US dollar index drifted 0.2% to 81.22. Brent crude fell US$1.02 to US$113.20/bbl, while West Texas rose US36c to US$95.66/bbl.

The Aussie is down another 0.3% to US$1.0195. After ignoring commodity prices for most of the year and being highly sought after by foreign central banks and funds looking for yield, the Aussie seems to have finally succumbed to the recent collapse in spot iron ore prices.

The SPI Overnight was up 14 points, or 0.3%.

It's jobs day today in Australia and tonight the US private sector jobs number is released ahead of non-farm payrolls tomorrow night. The US will also release its service sector PMI tonight.

And there was something else...um...oh yes: the ECB meets tonight.

Rudi will appear on Sky Business today at noon.