Stocks rise again

The euro lost a small amount of ground to sterling yesterday, dipping below 90p for the first time this week. The currency also fell back a touch against the dollar but only briefly and quickly rose back to the above the $1.18 level it has been at for most of this week. Equities edged higher again as the global rally in stocks continued with the S&P rising another 1% to set a record high close for the fourth consecutive day

The rally in stocks this week and the risk on environment – despite the host of headaches economies around the globe are facing as we head into the autumn – has led to a little of the shine coming off bonds this week. German 10-year yields have risen for three days and are up c.10bps by close of play yesterday to -0.42% and UK 10-years are also up c.10bps to 0.3% while US 10-years are up 6bps to 0.69%

US durable goods order were much stronger than anticipated in July, rising 11.2% following a 7.7% gain in June. The increase appears to be driven by a rise in demand for automobiles by consumers as the economy opens up again. The rise in core capital goods orders – a proxy for business investment – was a much more subdued 1.9% indicating that while manufacturing in the US appears to be in recovery, businesses are still very cautious about investing given the economic uncertainty

On the agenda today, we get another estimate of Q2 GDP in the US along with jobless claims for the past week. Speakers include ECB chief economist Philip Lane while Fed Chairman Powell will be making his closely watched Jackson Hole policy speech