Good Morning,

Last week, markets were in the main driven by mixed economic data signals, both in Europe and in the US, as well as the much anticipated ECB meeting last Thursday. Earlier in the week, US pending home sales, consumer confidence and ISM manufacturing all surprised to the downside, whilst Eurozone PMIs registered weaker numbers, as inflation for the single currency region dropped to 0.3% from 0.4%. The ECB left policy rates unchanged and announced no new additional policy measures, which disappointed many market participants. Despite this, a number of economists have their money on the ECB engaging in Fed-style QE, well into 2015. Markets were bolstered in the second part of the week as an unexpected increase in US Nonfarm payrolls coupled with a decline in the unemployment rate to 5.9% boosted US equity markets primarily. Market sentiment last week could have also taken cue from the protests in Hong Kong and the Ebola outbreak, however the economic impact of both issues remain unclear, so far.

Data releases yesterday were relatively on the quiet side, but this week we have got quite a number of important numbers to contend with, with money and credit growth data out of China being taking centre stage. We will also be closely monitoring monetary policy decisions in Japan, Australia and the UK, as well as the release of monetary policy minutes in the US and Japan, and Euro area industrial production print later on the week. Within the Emerging Markets space, we have also got monetary policy decisions in Indonesia, Poland and Peru, but the market will, without any doubt, be closely scrutinising exit polls for the second round of Brazilian election and the implications, albeit short term, it could have on the state of the Brazilian economy.

In fact, the outcome of the Brazil first round of election came in as expected, with incumbent Dilma Rousseff winning the largest share of the vote, taking 41.6%. However, and this came as a surprise to many, her opponent in the second round, which is scheduled for October 26, will not be Marina Silva but Aecio Neves, who obtained 33.5%, after Marina registered 21% of the votes. The implications for the rest of the race, and the Brazilian economy, remain hazy, but Brazilian markets rallied late during the day yesterday as expectations that the gap between Rousseff and Neves is to narrow intensified. Despite the uncertainty regarding the forthcoming second round of elections, the macro outlook remains uncertain because whoever wins, it is evident that there will be no quick-fix to the economy as Brazil faces a flurry of macroeconomic problems. While policy can make a difference in the short term, it will take time to reverse the damage caused over recent years.

Hewlett-Packard announced that it plans on separating its personal-computer (PC) and printer businesses from its corporate hardware and services operations in its latest attempt to get the company back on its feet by splitting it into two divisions. This split is expected to be in the form of a tax-free distribution of shares to shareholders in 2015 next year. If everything goes as planned, we would see the formation of two publicly traded companies, each with more than $50 billion in annual revenue.

Meanwhile, Walt Disney & Co. rescued its loss-making European subsidiary Euro Disney in the form of a €1bn deal that could give the U.S. group total control over Europe's biggest tourist attraction. The deal, which was announced yesterday morning, includes a rights issue and debt restructuring that will inject as much as €420mn into the Euro Disney group and eliminate €600mn of its debt owed to the parent company Walt Disney by means of an equity swap.

Have a nice day!