The Big Number
The rally in the British pound against the U.S. dollar over the past two weeks.

What this means
There is now some real clarity on Brexit as British Prime Minister Boris Johnson’s Conservative party won last week’s election in the biggest landslide since the Margaret Thatcher era of the 1980s. Investors, who have long avoided Europe, may start to reconsider their positioning there.

Market Notes
Finally an agreement between the U.S. and China on trade. Though it’s labeled as “phase one” and the details remain vague, it was enough for markets to rally to new highs as the planned December 15th tariffs were cancelled and some existing tariffs were slashed. The new North American free trade pact looks headed for passage as well.

The Markets’ Reaction
Emerging markets led global equities for the second week in a row, up 3.6% (MXEF). International developed markets followed, climbing 1.7% (MXEA). The S&P 500 returned 0.8% (SPX), rising to a record high on Friday. Credit did well and the U.S. dollar weakened.

What to Watch
Data will grow increasingly sparse as we head into the holidays but this week still has some interesting reports. Yesterday (Monday) the U.S., Japan, and the European Union all reported flash Purchasing Manager Index data. The U.S. showed continued expansion; Europe and Japan indicated modest contraction. The University of Michigan releases consumer confidence data on Friday.

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