All eyes on UK Parliament; US stocks close in on ATHs

Summary:

• UK MPs to vote on withdrawal agreement 

• US stocks trade near record peak

• CAD mixed after election and retail sales

• Oil jumps on talk of OPEC cuts

As far as UK assets are concerned the main events of the day will likely come this evening, after the stock market here in London has closed, with parliament set for two key votes. MPs will first vote on a second reading of the withdrawal agreement, with the consensus believing that the government will secure a narrow victory - which if it occurs would be the first time that MPs have back any Brexit deal. 

However, as is often the case with most things Brexit-related this isn’t straight forward and even if it passes there’s a fair chance that a vote on the timetable shortly afterwards will fail. Several MPs have already voiced their displeasure at the lack of time to scrutinise the bill, and if they vote down the program motion this would make the timeframe incredibly tight for the UK to leave the EU by the end of the month. The pound is trading a little lower on the day on the European close but the events this evening will likely determine where it finishes the day. 

October has traditionally been one of the more worrisome months for US stock markets with several well known large swoons giving investors the jitters whenever the month rolls around. However, the current month has been pretty solid on the whole and as we move into the final trading days US benchmarks are well placed to have another stab at moving up their previous peaks into uncharted territory.  The US500 is back near the 3010 level and within striking distance of its all time high at 3029.5 set back in July. 

The only real release of note this afternoon from North America comes in the form of Canadian retail sales, with the latest figures showing a little bit of softness in consumer spending. In M/M terms the headline retail sales data for August came in at -0.1% vs +0.4% expected, although this can be viewed more favourably than it first appears due to the prior being revised higher to +0.6% from +0.4% prior. There was a similar story with the core as a print of -0.2% was below the 0.0% consensus forecast but the prior was revised up to 0.0% from -0.1% originally. Also of note for CAD traders is the outcome of the recent elections, with PM Trudeau set to remain in place, albeit with a minority government.  

There’s been a sharp move higher in both Oil and Oil.WTI in recent trade after Reuters reported that OPEC are to consider deeper oil cuts at the December meeting. The story which cites 4 OPEC+ sources say the measures are due to the demand growth outlook in 2020 with the cartel stating the first steps will be to push for better compliance with the current quotas - Iran and Nigeria are among the countries that have failed to properly comply with cuts. Oil has jumped to its highest level of the day as the news hit the wires, with price running up to the prior highs around 60.25 before meeting some resistance