Eyes are on President Trump to announce his candidate choice to succeed Janet Yellen as the next Federal Reserve Chair. Media headlines indicate Trumps’ advisors are guiding him toward either Federal Reserve Board Governor Jerome Powell or economist John Taylor; however other candidates still remain in contention including the current Chair who’s term expires February 3. This weeks deadline for Catalan President Puigdemont to drop its independence claim was met with refusal adding to uncertainty around the region and volatility in Spanish stocks. The outlook for tax reform in the United States became brighter with the Senate’s recent adoption of a 2018 budget resolution.
United States stocks roared on during the week with its major indices breaking all time highs again. Third quarter earnings and the President’s tax plans seem to be the focus of traders. Foreign equities were not met with the same results as disappointing data came out of the U.K., a “No Deal” Brexit idea develops and Spain’s uncertainty all muted a broad rally. Japan’s Nikkei Stock Average did rise to the highest level in nearly 21 years just before its weekend election which could lead to Prime Minister Shinzo Abe leading the country until 2021. The majority of bonds declined as yields inched higher across the board and the prospects of a December Fed Funds rate increase becomes more likely.
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