US equities rally after midterm elections

US stock market post elections rally buoyed global market sentiment last week as uncertainty about changes on US political landscape receded. As Democrats took over House majority the SP 500 gained 2.1% and the ICE US dollar ended up 0.4%.

All major global stock indices except Hong Kong’s added to previous week’s gains.2 The Hang Seng index gave up almost half of last week’s record gain: it fell 3.3%. 3 The dynamics of major currency pairs movements carried over from the past week with the dollar recording the biggest change against the Canadian dollar: it rose 0.7%.

This week data from China and United States will be in focus. China’s industrial output and retail sales data due on Wednesday are expected to indicate the extent of Chinese economic expansion cooling off. US inflation report the same day is a major data point for gauging any likely change in Federal Reserve’s rate hike pace.