After yesterday’s heavy falls European markets have rebounded modestly, despite Asia markets finishing the week on the back foot.

This morning’s rebound appears to be predicated on a little profit taking ahead of a long bank holiday weekend and the US President keeping the door open that any new trade deal with China might involve measures to deal with the Huawei problem.

On the surface this does appear to be a slight softening of tone by President Trump, however it doesn’t mean we are any closer to a resolution. If anything this is likely to rumble on over the summer, as the US administration digs in for the long haul after announcing a three stage aid package for US farmers.

With the European elections out of the way in the UK, and the two mainstream parties expected to have done particularly badly, attention is now set to turn to the future of Prime Minister Theresa May, with the pound set to remain in the spotlight after 14 days of losses, against the US dollar, and the euro.

It is widely expected that at some time today Prime Minister Theresa May will finally put paid to all the speculation about the timing of her departure and announce a timetable for stepping aside.

While it is true that we have been here before, on numerous occasions since June 2017 when the Prime Minister lost her majority, this time it really does feel different, as the lights finally come down on what has been a turbulent last two years.

We can also look towards who might want to pick up such a thankless task, of trying to get a deal agreed, not only by her party, but also by Parliament. Mrs May’s durability is not in question, most people would have thrown the towel in months ago, as she tried to bring together the various disparate factions within her own party, as well as a parliament that has had all the discipline and cohesion of a children’s playgroup.

Most of the smart money appears to be on her staying until at least June 10th, after the D-Day commemorations and the visit of US President Trump, when it seems likely that, amongst others Boris Johnson will lead the race to replace her. It’s not clear whether she’ll stay beyond that date, and remain in situ until a replacement is found, or whether David Lidington her deputy will step up as a temporary stop gap.

None of this should come as a surprise to currency markets, and as such should already be priced in with the pound already looking a little firmer in early trading.

All of this completely overlooks the fact that we are still no nearer getting any form of agreement about where we go to next with respect to next steps before the October deadline. In fact any leadership contest is unlikely to be concluded much before September, assuming of course that there isn&rsquo t another election, which means that the UK may well have to ask for another extension from the EU in order to get any sort of deal across the line.

That is by no means a given and could depend on the results of yesterday’s EU elections. A big win for the Brexit party could well cause the EU to conclude the UK is a lost cause, and prompt some, like France to push to rip the band aid off and draw a line under the whole affair.

Despite all this political uncertainty the UK economy has continued to perform well although today’s April retail sales might see a dip, after a strong March rebound. A decline of 0.3% is expected despite Easter coming quite late this year, and some pleasant Easter weather.

On the earnings front information services group Informa has said that it performed well through the first four months of the year, saying it was well on course to meet its targets for 2019, including meeting its target of 4.5% underlying revenue growth, however there was little detail on anything more than that, begging the question why they even bothered.

Old Mutual shares have also dropped sharply on the open after its CEO Peter Moyo was suspended due to what is being cited as a “material breakdown in trust”

US markets also look set to rebound on the open ahead of the weekend, with April durable goods expected to show a decline of 2%. Yesterday we saw some evidence that the US economy might be starting to slow after both manufacturing and services PMI’s came in well below expectations.

On the earnings front Foot Locker is reporting its latest numbers for Q1. The company had a strong end to its fiscal year in its last quarter, as revenues and profits crushed expectations. Same store sales rose 9.7% in Q4 on revenues of $2.27bn and profits of $1.56c a share.

Its investment in a variety of niche areas is also helping its sales growth, including Super Heroic, Pensole as well as children’s apparel company Rockets of Awesome has contributed to the company’s solid performance. Profits for Q1 are expected to continue this trend with expectations of $1.60c as the company starts on a new financial year.

Crude oil prices have rebounded a little after posting their biggest one day falls this year, and are still on course for their biggest weekly loss this year. Concerns about future demand after a big rise in inventories and a deterioration in the macro environment appears to have prompted a sharp reorientation of investors risk profile, particularly since the outlook for trade looks more ominous that it did at the beginning of the month.

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