The stock market has opened on a firm note this morning and is testing the resistance of this year's highs. Recent economic data and the earliest of the US quarterly profit reports have helped support the outlook for equities. At the same time low interest rates and the potential for further stimulus from a range of central banks continues to drive investors towards equities.
Recent events suggest that investors will not respond to this morning’s shocking news of the terrorist attack in Nice. Terrorist attacks like this have not so far had any systemic impacts on financial markets or lasting impacts on international consumer or business confidence.
While the Bank of England surprised markets by failing to cut interest rates last night this is only a likely to be a minor timing issue. The Bank’s statement made it clear that it was likely to loosen monetary policy at its August meeting unless there was any significant change to the outlook.
Recent trade and inflation data suggest the data on China’s economy today should be close to expectations and present a steady as it goes read on the overall economy at this stage.