While market focus remains centred on tomorrow's US Presidential election (see sections below), today's data calendar is dominated by euro area releases.
Since August, Sentix investor confidence index has surprised on the upside, beating consensus forecasts every month and has been among one of the many economic survey indicators suggesting continued economic optimism despite the UK's referendum and the signals of a future 'hard Brexit'. The ECB's stated commitment to a 'very substantial degree of monetary accommodation' (see ECB review ), strong PMIs and strong Ifo expectations suggest Sentix investor confidence will continue rising. New orders PMIs showed promising figures in both August and September, indicating that the manufacturing sector was in a solid condition. As a result, we estimate another monthly increase for Germany factory orders today. Finally, while consumer confidence and improved labour market conditions in isolation point to growth in the euro area retail sales, last week's drop in the German print challenges these signals and the slowly increasing oil price was probably a drag on September sales. We therefore expect a slight drop in m/m retail sales for the euro area.
In the Scandies today, industrial production figures are due out of both Norway and Denmark. See Scandi Markets on page 2 for more details.
The main event this week is undoubtedly the US presidential election day tomorrow with the final result ticking in on Wednesday morning, European time. As we wrote in our US election monitor: It's not over until the fat lady sings , 4 November 2016, the recent developments in both national and state polls show that one should not rule out a Trump victory (see below). In terms of Congress, the Republicans seem likely to retain the majority in the House but it remains close as to who will win the Senate.
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