The stock market rallies that kicked off the week appear to have run out of gas with indices in Europe starting to backslide and US markets heading for a flat to slightly lower open. Although indices appear due for a trading correction after several straight days of advances, the blame for today’s retreat appears to be squarely on the shoulders of hawkish central bankers who appear to be gaining strength. Minutes from this month’s Bank of England meeting showed that two MPC members (Weale and McCafferty) voted for a 0.25% rate increase, the first dissenters on interest rates since Governor Carney took the helm last year. This news helped Sterling to retain its footing although its remains below the 200-day average and Fibonacci level near $1.6690 it broke earlier in the week. The Bank of England news has also changed attitudes about the minutes from the last FOMC meeting which are due this afternoon. Although Fed Chair Yellen is expected to remain dovish at her Jackson Hole speech on Friday, the last FOMC meeting had its first hawkish dissenter of the year and the street may look to the minutes for signs of how many potential allies Philadelphia Fed President Plosser may have that could put pressure on the others to reduce stimulus faster. The potential that the hawkish camp at the Fed may be growing has dragged on US stocks this morning, and a guidance cut from Target hasn’t helped the bulls cause either. USD is on the rebound today against most other major paper currencies but gold has stabilized in the mid $1,290s after yesterday’s takedown. In addition to GBP, CAD and NOK have been relatively strong with crude oil on the rebound NOK may also be active this morning with Norges Bank governor Olsen speaking. AUD has held up relatively well despite more threats from RBA Governor Stevens who noted AUD isn’t doing enough (read falling) to help rebalance the economy, that he feels the market has underestimated the downside risk to the dollar and that the RBA could still intervene in forex markets at any time without notice. NZD, meanwhile continues to underperform its peers following through from soft inflation numbers earlier in the week. Corporate News Target $0.78 as expected, cuts FY guidance to $3.10-$3.20 from $3.60-$3.90 below street $3.43 Lowes $1.04 vs street $1.02 Economic News Economic reports released overnight and this morning include: UK BoE meeting minutes 7-2 vote, dissenters wanted a 0.25% interest rate increase UK CBI total orders 11 vs street 4 Germany producer prices (0.8%) vs street (0.7%) Eurozone construction output (2.3%) vs previous 3.5% Australia leading index (0.1%) vs previous 0.1% Economic reports due later today include: 2:00 pm BST Norges Bank Governor Olsen speaking 10:30 am EDT US crude oil inventories street (1.75 mmbbls) 2:00 pm EDT US FOMC meeting minutes