Daily update
Daily update
- The UK remains a source of market volatility (the US employment report may distract investors at the end of the week). The UK Chancellor is set to speak today. The UK Prime Minister has suggested the more controversial policies were the Chancellor’s idea. So far free markets have given a negative verdict whenever the Prime Minister or Chancellor has spoken.
- The UK situation raises two investor considerations. Will the policy proposals actually pass Parliament? Normally a finance bill is considered a vote of confidence, but specific parts of the policy proposals are widely and strongly opposed. If the policies do pass Parliament, how long will they last? An election is due in 2024; if markets price a change of government (and policy), that may put a floor under asset prices.
- Assorted business sentiment surveys are due. The Japanese Tankan suggested the service sector is OK now, but the service and manufacturing outlook was weaker. As with European and US sentiment surveys later today, forward-looking projections may be more subject to spin than reporting reality.
- Williams and Bostic of the US Federal Reserve and Mann of the Bank of England are due to speak. Williams and Mann likely matter most. In Brazil, a second round of the presidential election seems likely.
