In the US overnight, stocks finished the session firmer, and at their highest levels since April despite a late-session sell-off, triggered by continuing concerns over the mortgage foreclosure crisis.
Once again, the technology-laden NASDAQ was the top performer, up 0.5% while the Dow Jones Industrial Average and broad-based S&P 500 could only manage gains of 0.3% and 0.2% respectively.
Across Asia, regional markets are mixed in afternoon trade despite modest gains on Wall Street. As at 06:10, the Nikkei turned around from earlier lows as the yen weakened throughout the cash session and is up 0.3%. The Shanghai composite continues to push higher, up 0.3% and at 52-week highs. The Hang Seng is the laggard lower by 0.1%.
In Australia, the ASX 200 closed 0.5% weaker at 4687, just off its session lows of 4685. After yesterday’s M&A-fuelled outperformance the local market cooled its heels today with investors seemingly wary of regulatory impediments derailing offshore interest in local stocks. Yesterday’s unexpected gains have also left the market a little susceptible to short-term profit taking with 4700 again proving a level of resistance. Losses for the session have been relatively broad based with the financials, consumer staples, energy and industrial sectors among the worst performers.
Turning to the currency markets and once again we saw the equity markets react negatively to the stronger USD with markets closing off their high. The euro once again proved it really struggles to hold the 1.40 level, with sellers emerging to push it down to 1.3907 in Asian trade.
Looking at today's agenda for European trade, the UK preliminary GDP reading for Q3 is likely to headline for many and will be closely watched as there's a risk this could dip. Not only would this mark a sharp deterioration in the country's economy, but it would doubtless instigate another wave of suggestions that a double dip may be on the cards. Of course any suggestion that the BoE should extend its own QE programme may be a shot in the arm for stocks, but gilts and sterling would be left drifting.
Consumer confidence readings from France, Germany and the US will add to key drivers during the coming hours, whilst there's a raft of high-profile earnings due too. UBS kicks things off in Europe, whilst Ford, DuPont, Western Union and Bristol Myers Squibb are amongst the highlights on a busy US reporting calendar. With successive indices ticking off fresh 2010 highs, markets continue to look a little toppy even in light of QE proposals.
Ahead of the open we're calling the FTSE down 11 at 5741, the DAX up 2 at 6641 and the CAC down 7 at 3863.