Market Update 10/10/13

One line- Risk on moves as scheduled talks in Washington spur on the belief that a deal will be made soon.

- Obama is stepping up discussions with Congress meeting 20 senior Republicans from the House of Representatives at the White House tomorrow. The White House invited all House Republicans to meet Obama but House leaders decided to send a more moderate delegation without Tea Party participation. http://www.ft.com/cms/s/0/0591a56a-3102-11e3-b478-00144feab7de.html#axzz2hJ0DClf5

- The flurry of talks in Washington and Yellen's confirmation have rallied global stocks. US bonds have fallen while industrial commodities and oil have advanced. The FTSE is up 0.62% this morning, the Nikkei added 1.12% and the S&P added 0.06%. The dollar gained 0.2% on the news.  http://www.ft.com/cms/s/0/749b7f0a-315a-11e3-b991-00144feab7de.html?siteedition=uk#axzz2hJ0DClf5

- Fed minutes released yesterday showed policy makers were split in half over whether to begin tapering in September or not. Obama nominated Yellen to head the Fed yesterday and she is expected to be easily confirmed by the Senate. http://www.ft.com/cms/s/0/de0b5b80-3106-11e3-b991-00144feab7de.html#axzz2hJ0DClf5

- Brazil lifted the Selic to 9.5% from 9% for a fifth straight time as the real continues to slide and contribute to inflation. Inflation has consistently remained above the 4.5% target while the IMF has cut Brazil's growth outlook for 2014 to 2.5% from 3.2%. http://www.bloomberg.com/news/2013-10-09/brazil-extends-record-rate-lift-as-inflation-outlook-worsens-1-.html

- Militants have abducted the Libyan prime minister, Ali Zeidan, after his government was accused of allowing US commandos to kidnap an alleged Al-Qaeda member. http://www.ft.com/cms/s/0/ed2b538c-3164-11e3-b478-00144feab7de.html#axzz2hJ0DClf5

Data

S&P 1656.40 0.06%

FTSE 6390.53  0.83%
Nikkei 14,194.74 1.12%

EUR/USD- 1.3519 0.04%
USD/JPY- 97.84 0.51%
GBP/USD- 1.5937 0.11%

Gold- 1304.96 0.05%
Oil (Brent)- 110.07 0.93%

Copper- 322.90 0.06%

10 year yields

US- 2.69 (+2bps)
UK- 2.70 (+2bps)
Japan- 0.65 (+1bps)