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The UK, US and the Eurozone in the week ahead

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Unbelievably, it’s time. An insane year is about to go through its latest gauntlet, as America votes for its next president.

US: Who will be the next President of the USA?

There’s been so much going on in the run up to the election that the markets have struggled to fully focus on the vote itself. And though it will still have stiff competition due to the ongoing covid-19 crisis, there’s only one headline story this week.

SpreadEX has Joe Biden in as favourite to succeed but more important, however, is the size of any potential Biden victory, as that will be what impacts the next few years of governance.

Something that could be a key market mover during the tumultuous hours after the votes start coming in is how Trump acts if he loses. Any sign that a potential handover will be plagued by resistance from the incumbent will be a real worry for investors – the last thing the market needs at the moment is more uncertainty.

If investors can pull themselves away from the two Ps – politics and the pandemic – there is plenty of data to sink their teeth into. The final Markit and ISM manufacturing PMIs are out on Monday, with factory orders on Tuesday, the final Markit and ISM services PMIs on Wednesday, jobless claims on Thursday and October’s nonfarm jobs report on Friday.

If that wasn’t enough, the Federal Reserve also have their latest meeting on Thursday night – though it is hard to see it being a noteworthy get together given the proximity to the election. Still, investors will be curious to see what Jerome Powell and co. have to say about the new political landscape (it’ll likely be further drum-beating about the importance of a stimulus package, regardless of who wins).

UK: Bank of England set to unleash new stimulus

As the world turns its eyes to Washington, the UK is in for a rather big week itself thanks to Thursday’s Bank of England meeting. With the economy flagging, Andrew Bailey and his MPC chums are set to unleash another blast of stimulus, likely in the form of a £100 billion expansion of its asset purchase programme.

Beyond that, the FTSE is probably going to be led by macro matters, be it the election results or covid-19 restriction concerns, with the country creeping towards a nationwide lockdown. If it is up for something more local, the final manufacturing PMI is released on Monday, with the services equivalent on Wednesday, and the construction PMI on Thursday.

Eurozone

Like the UK, it will be hard for the Eurozone to do its own thing due to the pressures of the election and covid-19. In terms of data there are the manufacturing PMIs on Monday, services PMIs on Wednesday, retail sales on Thursday, and German industrial production on Friday.

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This article is brought to you in association with Spreadex. All opinions expressed in this article are from the author and do not necessarily represent the opinions of The Armchair Trader. You can find out more about Spreadex products and services here, or find more articles from Connor Campbell here.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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