Morning Update – 30/10/2017 – by Arjun Lakhanpal

October 30, 2017 by

Morning all.. Wall St had another decent close led by tech and banks with the S&P closing up 0.8% and the Nasdaq up 2.2%. The Dow lagged closing up just 0.14% after strong earnings from tech firms driving the Nasdaq and talk of Trump leaning towards Powell, who is keen on de-regulation, which saw banks rally. However, stocks in Asia saw no follow through as weakness in China rattled nerves with the Nikkei closing unchanged and China down 0.36%; HK fell again. Speculation continues around who U.S. President Donald Trump will choose as the next Fed chair, with Governor Jerome Powell said to be the front-runner. We expect a decision this week and this has capped the US yield rally and weighed on the dollar. EUR remains rather weak but off the Friday lows. In Spain, the next hurdle in the battle with Catalonian separatists comes Monday, when public employees have to decide which side to follow. Barcelona’s streets flooded with hundreds of thousands of pro-unity demonstrators over the weekend, pressuring local lawmakers who pledged to defy Madrid’s direct control of the region. The Fed’s next rate decision is on Wednesday, with economists expecting the central bank to keep rates at 1.25 percent and to increase them at the December meeting. GBP also in focus this week with the BoE expected to hike this week. FX markets were very quiet and US 10yr yields dipped to 2.405%. On the data front this morning we get Spanish GDP, Regional and nation CPI from Germany through the morning and UK Mortgage data and Money supply data. Good luck..