On Tuesday as the FTSE 100 closed at a 5 and half year high, as the potential takeover of utility company Severn Trent. Equity indices in Europe and the US have powered higher, fuelled by investors search for a return. The prolonged period of record low yields on government paper, and the cost of debt financing has led to an increase in M&A activity.
The dollar has been strong across the board, reaching multi-week and month highs against all of the majors. The depreciation in the Yen continues as it prints above the 102 mark, with investors taking advantage by investing in Japanese equities on the expectations the weak Yen will increase exports.
US 2013 budget deficit is expected to come in at $642 billion, nearly $200 billion below previous expectations. This equates to nearly 4% of the economy, a massive reuction from 2009 which registered at 10.1%, when the government ran a record budget deficit of $1.4 trillion. The Congresiional Budget Office report comes at a time when Washington is at gridlock over the budget.
Fitch upgrades Greece from CCC to B- with a stable outlook
The main oil companies (Shell, BP & Statoil) were all raided on Tuesday as a probe is opened looking into potential collusion on price fixing
Bank of America-Merrill Lynch said Wednesday it has cut its GDP forecast for this year and next to 7.6% from 8.0% and 7.7%, respectively - MNI
The Government faces a £12 billion bill for a "totally useless" bank crisis fund imposed on Britain by the European Union after George Osborne was left isolated at a Brussels meeting of finance ministers today - Daily Telegraph
At 9:30am UK jobs data is released and at 10:30am the Bank of England’s quarterly inflation report will be released, as Cable trades a 6-week low