Italian and Spanish May services PMIs....>

DATA REACT: Italian and Spanish May services PMIs each came in above

expectations (SP: 27.9 v 25.0 exp;, IT: 28.9 v 26.1 exp.), each marking much

smaller service sector contractions than April (SP: 7.1, IT: 10.8).

- Still, these were some of the worst readings on record.

- For both countries, Markit noted a continued drop in new business and foreign

demand, with weak conditions contributing to spare capacity and therefore

significant job cuts.

- Both surveys suggested slightly more optimism as lockdowns lifted, with

Italian service providers the more optimistic of the two as expectations for

activity in the year ahead moved to positive territory; for Spain, business

confidence improved "noticeably" though remained in negative territory.

- Re the 12-month outlook, Spanish service providers "continued to signal

worries about the longer-term impact on consumption and broader economic

activity from the COVID-19 pandemic".