Morning Update – 02/11/2017 – by Arjun Lakhanpal

Morning all.. Wall St Had a pretty quiet session and the S&P closed up just 0.16% with the Nasdaq marginally lower. Meanwhile, the Nikkei continues to make solid gains and closed up another 0.53%. A boost to Honda Motor Co.’s profit outlook lifted its shares and helped other transportation stocks drive the Topix index to the highest level since February 2007. But the dollar failed to hold gains and followed US Treasury yields lower after a brief rally in both into the NY close. The fall due to the prospects of U.S. tax cuts and as investors digested news (WSJ sources) that President Donald Trump will pick Jerome Powell to lead the Federal Reserve. Powell, a governor on the Fed board who’s never differed with Chair Janet Yellen on policy decisions, will be nominated by Trump to succeed her, according to three people familiar with the decision. Investors remain focused on the progress toward American tax reform, corporate earnings and Friday’s U.S. jobs report. There have been conflicting reports when and how the U.S. tax rate on companies would be lowered. In the UK, anything other than a rate hike from the Bank of England on Thursday would be a surprise to markets. Governor Mark Carney may signal even more tightening if the economy performs in line with new forecasts, but that’s unlikely, according to Bloomberg Intelligence. Officials will probably lift the growth outlook for 2018 and lower it for 2019. Inflation forecasts may be raised for this year and left unchanged for next. This morning we get Spanish, Italian, German, French and EU manufacturing PMI data, and of course the BoE rate setting announcement where a hike is fully priced. Good luck.