The FTSE close above 5281 provides a technical break. Momentum is now positive and this should provide the foundation for a real test through stubborn resistance at 5300.

The price action on Friday indicated again that investors are looking more closely at corporate news rather than economic developments. On the whole, the economic news out on the day was disappointing, whether that was in the US or Europe. The European GDP data though did demonstrate that the UK is lagging behind its major counterparts with the UK economy now being the only major developed country still in recession, according to Q3 GDP data.

This week, the UK data will provide some indication on whether we can rebound to growth during Q4. The key releases to follow are on Wednesday with the BOE minutes; with the market watching carefully for any signs of splits within the MPC. Whilst on Thursday, October retail sales report will provide some further evidence of how strong a rebound the UK is witnessing during Q4. In Europe, the economic data is thin on the ground with more attention likely to be drawn to Trichet speeches on Wednesday and Thursday.

In the US, today sees the release of October retail sales. The headline rate should be boosted by car demand and of course the upbeat comments by JC Penny on Friday have also fuelled expectations. Today also sees the start of regional survey releases with NY Fed Empire Business survey due and on Thursday Philly Fed. The rest of the week sees the inflation data in the form of both CPI and PPI and housing data, (NAHB homebuilders and housing starts and permits). The key Fed speech also happens today, with Bernanke’s address to the NY Economic Club.

Sources: Reuters: BBC: Bloomberg: Lawshare: Deutsche Bank (db): Proquote: Financial Times: Wall Street Journal: CLSA: Sharescope: Market News. Capital Economics: CNBC: Wikipedia:

Please note this report provides a guide to some of the relevant areas that individual investors should consider discussing with an authorised adviser in relation to their specific circumstances, it does not constitute individual advice. As a result no action should be taken or refrained from being taken as a result of its content.