MARKETS SPECTATOR: Seeking direction

In the first trading session in four days, stocks managed to open the session firmly in the black before drifting into negative territory and now recovering to be hovering around the flat line.

The NASDAQ is the worst performer, down 0.4 per cent, while the S&P 500 and Dow Jones Industrial Average are 0.15 and 0.07 per cent firmer respectively.

It's been a packed session in the US as market participants have been forced into digesting three days worth of information and data into one session, hence the real lack of clear direction.

Judging by the price action of the last three trading days, indecision is the name of the game as the market consolidates, working out where it heads next just above the key psychological 1400 support level on the S&P 500.

It really is crucial that this level is maintained as it will ensure the pullback is very shallow and allow the market to move into a consolidation pattern, readying itself for the next move north when some of uncertainty lifts in the coming weeks.

Following overnight action on Wall Street, it looks like the local bourse is set for a slightly weaker open, down around 12 points to 4510.

The big market moving news for the day will be the release of Chinese PMI figures at midday and HSBC Final Manufacturing PMI data at 1245 AEDT. Following readings of 49.8 and 49.1 respectively last month, the market is expecting a rise to 50.3 for Chinese PMI and 49.1 for the HSBC release.

There has been a noticeable pick-up in Chinese data and sentiment towards the up and coming superpower in recent weeks so today's readings will be absolutely crucial in keeping that momentum going.

Elswhere, the AIG Manufacturing index is due for release before market open at 0930 AEDT while import prices for the quarter are due at 1130 AEDT. In corporate news, the big event will be Whitehaven Coal's AGM, where largest shareholder Nathan Tinkler has announced that he will be voting against the chairman and most of board with the view of removing them.