By Lee Wild, Head of Equity Strategy at Interactive Investor

For now, it seems investors have little to fear. A weak pound remains a boon for British firms making money overseas, and there’s a lack of easily accessible alternatives to equities able to generate similar returns. UK stocks also sit firmly in the slipstream of US peers, benefiting from a revival of the reflation trade there.

While the current trend for equities is firmly positive, the pound has staged a partial recovery Monday following a heavy hint from Theresa May over the weekend that a Cabinet reshuffle is imminent. If that silences dissenters and restores order to the political ranks, one threat to further progress during the fragile Brexit process will have been removed, at least temporarily. Sterling is already stronger Monday, which is limiting progress for the FTSE 100 following last week’s big gains.

GBP Notes 10 and 5 (LGT)

It’s a quiet start to the week in London, the calm before the storm as results season kicks off in the US. A lot of optimism is baked into share prices currently, so the numbers had better impress.

Central banks figure heavily again this week. ECB president Mario Draghi talks in Washington Thursday, but there’s greater market-moving potential a day earlier. Minutes from the Federal Reserve’s last meeting, due midweek, will give a little more insight into the debate among policymakers. However, we’ve had a slew of speeches from Fed officials since, and another round this week will give greater clues as to individual thinking on US rates and unwinding Quantitative Easing. It would be a major shock if US rates did not go up in December.

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