Stocks take a breather

The pound is a little firmer this morning, as negotiations on the future UK-EU relationship are set to continue this week, trading below 89p against the euro and at over $1.33 against the dollar, while the euro is not much changed against the US currency, hovering around the $1.1850 level having traded in a tight range last week

Equities took a breather last week, having had a good run recently, with US stocks losing some ground on Friday and over the week as a whole and European indices chalking up just modest gains. Meanwhile, core bond yields continue to nudge down with German 10-year yields approaching -0.60% and equivalent US yields not far off 0.80%

Consumer confidence in the Euro Area dipped for a second month running in November according to the European Commission measure, no doubt reflecting the renewed increase in COVID-19 cases and associated tighter public health restrictions, though it remains off its lows of last spring

The ECB’s Chief Economist Philip Lane sees lockdowns in Europe leading to a drop in economic activity but notes that the measures this time around are less harsh than those in spring and, hence, the impacts are likely to be less severe

Data due today includes flash PMIs for the Euro Area, UK and US economies

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