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MICHAEL MACKENZIE: Here's what we're watching with trading under way in London. The pound has lost some steam in what reflects a modest reversal from yesterday's big swings across the markets. Naturally, a weaker pound means a higher [? FTSE ?] 100, even with Pearson shares slumping on yet another profit warning from the company.
Equity market gains in Europe are modest, not a surprise with a host of events looming. US inflation data will arrive in a few hours, and may well drive sentiment for the dollar and treasury yield, while Janet Yellen also speaks later today. We then have a meeting of the European Central Bank tomorrow.
Beyond that, the main event looms Friday. The inauguration of Donald Trump. Will we hear more policy details that can arrest the fatigue that has sapped the celebrated Trumpflation trade? US financial shares were hit hard overnight, as investors look at a flatter yield curve, but also reassess just how quickly the regulatory framework for banks will loosen, if at all. Now as markets await the first 100 days of a Trump presidency, we can expect to see some big swings across asset prices. So for investors, the message is, buckle up.
