So far this morning the biggest market action by far has been in the UK where Sterling is soaring and the FTSE is plunging.

Building on the upward momentum from Thursday, the pound has skyrocketed up over $1.3500 against USD and over 150.00 against JPY, while also posting a big gain against EUR. The gain in the UK currency is sending The FTSE through the floor down 1.5% so far today.

The rally  started by hawkish MPC minutes and hawkish comments from Bank of England Governor Carney accelerated today with MPC member Vlieghe also indicating the bank rate could rise in the coming months. This has been seen as significant because Vlieghe has been one of the more dovish MPC members of late. Expectations for the removal of last year's rate cut have moved up from mid-2018 to as soon as the next meeting in November.

Overnight, North Korea launches another missile test over Japan with the range to reach Guam, an island with US military bases that has been threatened as a potential target. The market has been taking this in stride as defensive havens gold and JPY are sliding this morning which has helped to boost the NIKKEI 0.5%

US markets have been steady so far today but this could change later in the morning with a number of data points due including retail sales, Empire Manufacturing, industrial production and consumer sentiment. This is the last major basket of US reports ahead of next week's FOMC meeting.  The Fed is expected to start normalising its balance sheet but the data may indicate whether a December rate hike is a possibility or not. The afternoon Baker Hughes rig count is likely to still be distorted by hurricanes and will likely be discounted. 

Retail sales may also impact retail and auto stocks following a summer of volatile auto sales and ongoing struggles in the retailing sector under competition from online merchants.

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