After bond market tremors, now for the data test

A look at the day ahead in European and global markets from Johann M CherianMarkets have been dealing with the steep selloff in Treasuries worried about the U.S. fiscal health, and in Europe the next test will be how businesses have been faring in the face of an uncertain trade environment.Manufacturing and services sector surveys for May will grab the spotlight on Thursday, and forecasts indicate that business activity in the eurozone and Germany has broadly been steady from the previous month.European earnings so far show that corporate health has been better than initially feared and stocks have been riding the tide of the temporary U.S. tariff pause and signs that China, a top customer for European firms, is striving to revive consumption.That has left the pan-European STOXX 600 .STOXX outperforming the S&P 500 .SPX and the Nasdaq .IXIC this year. The export-heavy German benchmark .DAX closed at a record high on Wednesday and is the best performing major stock market in the world.However, the path ahead would depend on whether European Union leaders can manage to negotiate trade deals with the U.S. and on the impact of the highly anticipated German fiscal stimulus package.European futures STXEc1 indicated a dour start to the day as risk sentiment was shrouded by lingering worries of how the U.S. could manage to finance its ballooning fiscal debt as investors exit U.S. assets.President Donald Trump's massive tax and spending bill cleared an important procedural hurdle in the Republican-controlled House of Representatives, setting it up for a vote that could take place within hours.Also worrying investors was the lacklustre auction of Treasury bonds that reinforced the "Sell America" narrative, weighing on not just the dollar but Wall Street as well, with traders already jittery after Moody's cut the U.S. triple-A credit rating last week.The yield on 30-year Treasury bonds US30YT=RR stayed above 5% after hitting a 1-1/2 year high earlier in Asian hours.However, not all assets were taking it on the chin. Bitcoin prices BTC= touched a fresh record high on improving sentiment around digital assets. The world's most valuable cryptocurrency has gained nearly 50% from the early April selloff, breaking above the $100,000 mark.Prices of gold XAU= were also making a comeback from a recent slip, given that investors perceive the precious metal to be a safe-haven favourite in times of uncertainty.Key developments that could influence markets on Thursday:Data:- Business activity surveys out of the eurozone, UK and the U.S. along with weekly jobless claims out of the United States- Remarks from European central bank policymakers including Philip Lane, Luis de Guindos expected- Bank of England Deputy Governor Sarah Breeden and Chief Economist Huw Pill to speak later in the day- Comments from U.S. Federal Reserve's Thomas Barkin due