Share markets globally returned to levels not seen since October last year as bond traders started selling in earnest. Fears remain about the outlook for Europe, but recent data from China and the US indicates a stronger growth outlook than currently priced by interest rate markets. The Yen is the main loser in currency markets as investors shun safer havens in a return to growth exposures.

The potential for movement on trade issues is also supporting risk assets as talks resume in earnest in Beijing. The British parliament’s rejection of a no-deal Brexit, albeit by a single vote, removes a potential global negative and could see further strength in the Pound. These factors may see Asia Pacific share markets outperform flat indications from overnight futures trading.

A lack of significant macro data today means local markets may focus on domestic drivers. In Australia investors will turn to tonight’s budget reply from the Leader of the Opposition. Policy measure are important but the fact an election is in the offing means the likely areas of contention between the major parties could drive market reactions. Tax cuts are a matter of how much rather than if, and consumer exposed stocks and the broader market may continue to receive support.